Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

GLASGOW CORPORATION ORDER CONFIRMATION (No. 2) BILL

Considered; to be read the Third time Tomorrow.

Oral Answers to Questions — WIRELESS AND TELEVISION

Interference, High Wycombe

Mr. John Hall: asked the Postmaster-General when he expects to be able to eliminate the interference in television reception suffered by the residents of Green Street, High Wycombe.

The Postmaster-General (Mr. Ernest Marples): We have made some progress to that end, but unfortunately, the complete elimination of the interference is not yet in sight. I can assure my hon. Friend that we are not sparing our efforts to deal with this very difficult technical problem, and I should like to take this opportunity to express my appreciation of the help we have received from the manufacturers and users of the offending machines.

Mr. Hall: Whilst the television owners in the Green Street area of High Wycombe are very grateful to my right hon. Friend for the efforts made by his Ministry to overcome this problem in co-operation with the firm concerned, is he aware that for some considerable time they have been unable to receive television programmes up to 10 o'clock at night? Therefore, as they have paid for something which they have not received for a long time, is my right hon. Friend prepared to make them a refund of part of their licence fee?

Mr. Marples: Generous as I am by nature, I could not agree to the last part of my hon. Friend's supplementary question. I can assure him that we are making great efforts and that the firm concerned is really helping, but the difficulty is caused by radio frequency heating machines, which are universal in the furniture industry. We hope to overcome it, but whether we shall is another matter.

Warrenpoint, Kilkeel and Annalongy

Captain Orr: asked the Postmaster-General whether he is aware that holders of radio and television licences in the Warrenpoint, Kilkeel and Annalongy areas of County Down are experiencing poor reception; and what plans the British Broadcasting Corporation have for improving their services.

Mr. Marples: Suitable receiving aerials are essential to get the best results in this area. With these the Home Service and the Light Programme on medium and long waves should generally be satisfactory, but reception of the V.H.F. sound service and of B.B.C. television will unfortunately be variable because of the screening effect of the Mountains of Mourne. The B.B.C. tells me it regrets that there is nothing it can do at present to improve reception. It will continue to keep the needs of the area in mind.

Captain Orr: Is my right hon. Friend aware that this is another case of people paying licence fees for very little, that the reception is really quite deplorable and that there is now no reason at all why the B.B.C. should not proceed with one of its smaller satellite transmitters to serve this area?

Mr. Marples: The B.B.C. has a fairly large programme of satellite transmitters and no doubt it will have the needs of this area in mind. At the moment, however, it is a difficult technical problem because of these mountains about which we heard so much in N.A.A.F.I. concerts during the war.

Oral Answers to Questions — POST OFFICE

Counter Service (Advisory Committee)

Mr. Patrick Maitland: asked the Postmaster-General what measures he now proposes to ensure courtesy and efficiency at post office counters.

Mr. Marples: As a first step I propose to set up a small committee to advise me whether conditions and procedures at Crown Office counters are the best that can be devised to ensure the efficient, courteous and economical transaction of public business. Both staff and customers will be represented on it, as well as the Ministry of Pensions and National Insurance, which has the greatest share of our agency services to other Departments.
The committee will be authorised to employ industrial consultants and I have in mind to publish its report. I shall then ask a panel of my Advisory Council to give me its views as to what action I should take in the light of the report, and I shall probably invite one or two individuals with outstanding qualifications and experience in the field of customer relations to join the panel for this purpose.

Mr. Maitland: Will my right hon. Friend make sure that the investigation takes account of the situation arising out of queues in Post Offices, particularly of those people who queue for motor car licences early in the year and those who queue for the payment of pensions and other Welfare State services over the counter?

Mr. Marples: Certainly I will. That is exactly one of the problems which I had in mind when deciding to appoint this committee.

Mr. Ness Edwards: Will the right hon. Gentleman also take into account the views and advice of the regional advisory committees in view of the fact that the problems may be different in the provinces from the very large towns?

Mr. Marples: The chairman of the committee is one of the regional directors.

Staff (Interchanges)

Mr. Temple: asked the Postmaster-General what further developments there have been in his scheme of interchange of staff between the Post Office and industrial concerns.

Mr. Marples: Two Post Office men, an administrator and an engineer, have now taken up temporary appointments at I.C.I. Limited and two I.C.I. men have come to the Post Office. The exchange is expected to last for about a year and will, I trust, achieve the same success as has

so far attended the interchange of staff between the Post Office and Unilever Ltd. which commenced earlier this year. I am indebted to the board of I.C.I. Limited for its co-operation in making this further experiment possible.

Mr. Temple: Is my right hon. Friend aware that his statement will give widespread satisfaction, and will he take all possible steps to maintain this sphere of co-operation between the Post Office and private industry?

Mr. Marples: I think it is a good idea because these large firms in private industry are the best customers of the Post Office. If they send some of their men to the Post Office they can have experience of how we work, and vice versa. I am sure that it can do nothing but good.

Mr. Emrys Hughes: In view of the fact that the Co-operative movement has just as much experience as the I.C.I., will the right hon. Gentleman co-operate with the co-operators?

Mr. Marples: Not in view of the report of the right hon. Gentleman the Leader of the Opposition.

Vans (Parking)

Mr. E. Johnson: asked the Postmaster-General if he is aware that "No Waiting or Loading" signs in streets in the London, W.1 area are sometimes ignored by drivers of Post Office vans; and if he will take steps to ensure that drivers employed by his Department adhere rigidly to these regulations.

Mr. Marples: Post Office vehicles are permitted to wait in restricted streets under specified circumstances. I am not aware that Post Office drivers are abusing the regulations, but I should be happy to inquire into any case that my hon. Friend cares to bring to my notice.

Mr. Johnson: Will my right hon. Friend be good enough to instruct drivers to be especially careful in some of the very narrow streets in that part of London where the whole flow of traffic is sometimes held up? I quite appreciate their difficulties, but perhaps they might be a little more careful.

Mr. Marples: I can assure my hon. Friend and the whole House that it is becoming a nightmare in the West End


of London to deliver and collect mails on time, largely because of the waiting cars. The task of the Post Office drivers is made very difficult. The regulations allow Post Office vehicles to wait when mail is being delivered or collected. If my hon. Friend wishes, I will send him a copy of the regulations. I think he will find that we do not abuse them in any way.

Mr. Ness Edwards: Does the Minister appreciate that these drivers have a difficult enough job without being harassed in this House?

Mr. Marples: I do not think they are harassed in the House. I am quite certain that they have an extremely difficult job, and some of the head postmasters in the West End of London have an even more difficult job to get the mail through on time.

Robberies

Mr. Lipton: asked the Postmaster-General how many actual and attempted robberies of post offices have taken place during the past year; and how much was stolen.

Mr. Marples: In 1958-59 there were 28 robberies and 29 attempted robberies. The amount stolen was £7,290.

Mr. Lipton: Does the right hon. Gentleman agree that these figures are rather disturbing? In order to provide better protection, could not some alarm bell system be provided at all post offices to deter some of the bandits and provide a little more protection for these hardworking public servants?

Mr. Marples: I do not think that the figures themselves are alarming. The counter transactions are £5,000 million a year, and the losses have been £7,290. Even so, any loss is naturally a source of disquiet. We have a bandit alarm which we are now extending, especially in London, because the risk of attack in the provinces is only about one-tenth of that in London. We are, therefore, equipping offices there first with a new type of bandit alarm which can be operated along the length of the counter.

Mr. Lipton: At all London post offices?

Mr. Marples: No; we are attending to the worst districts. As the hon. Gentle

man knows, some districts in London are worse than others, and it is in the worst districts first that we are giving post offices the benefit of this new system.

Mr. C. R. Hobson: Can the right hon. Gentleman break down the figures he has just given to distinguish between Crown post offices and ordinary sub-post office agencies?

Mr. Marples: Not without notice.

Oral Answers to Questions — TELEPHONE SERVICE

Lanarkshire

Mr. Patrick Maitland: asked the Postmaster-General how many telephone subscribers were among the more than 70 families which have moved from the village of Douglas, in the county of Lanark, since 1st January, 1959.

Mr. Marples: So far as I know, none. Only one residence telephone has been given up since 1st January, 1959, and I understand that the previous customer is still living in Douglas.

Mr. Maitland: I thank my right hon. Friend for that Answer, but will he try to accommodate incoming key industrial workers who may come to take some of the subsidised houses, of which more than 50 are now vacant, should they need telephones to assist them in their industrial work?

Mr. Marples: We will do our best. At this particular exchange, the capacity is 150 lines, 117 of which are working. There are eight outstanding applications. There is thus a spare margin of 25 lines, so we shall be able to cope with any applications which are made.

Mr. Patrick Maitland: asked the Postmaster-General if he will state the present total capacity of the Douglas telephone exchange; and how many lines he expects will be vacated during the next six months.

Mr. Marples: The present capacity is 150 lines. One hundred and seventeen lines are in use, this being one more than a year ago. Since 1st January, 1959, eight new applications have been received, and one line has been given up. I cannot anticipate how the position will change in the next six months.

Mr. Maitland: Has my right hon. Friend any view about the number of telephone lines now used by Douglas Castle colliery, which is to be closed down, thus making the lines vacant? How many will be available for incoming industry as a result of this closure?

Mr. Marples: I cannot answer without notice. Quite apart from that, however, we have enough lines, so I am quite satisfied.

Subscriber Trunk Dialling, Bristol

Mr. Robert Cooke: asked the Postmaster-General to what extent the new system of subscriber trunk dialling at Bristol is being used; what is the general reaction to it; and if he will make a statement.

Mr. Marples: Bristol Central subscribers are now dialling themselves 97 per cent. of their trunk calls to the towns accessible by subscriber trunk dialling, which include about half the telephones in the country, and are making 40 per cent. more calls to these places than they did before.
Trunk calls are usually shorter now, and with the new tariff this means better value for money. So, too, with local calls, where 77 per cent, of those made by Brstol subscribers now last less than three minutes and are charged at 2d. instead of 3d., as previously. Our customers seem pleased with the service, and I am grateful for their co-operation in making it a success.

Mr. Cooke: I thank my right hon. Friend for his encouraging reply. Will he note that his good report is confirmed by the Bristol Chamber of Commerce and other responsible local bodies?

Mr. Marples: We sent out a questionnaire, and we have received 1,600 replies, nearly all of which have been favourable. When we have analysed them, I propose to give the House some more information about what the telephone users think.

Mr. C. R. Hobson: Can the Postmaster-General tell the House when he proposes to extend the Bristol system, in view of the fact that the Bristol people, while they welcome it, are at a distinct financial advantage compared with people in the rest of the country?

Mr. Marples: The programme is set out in the last White Paper. If the hon. Gentleman reads Appendix A or Appendix B of that, he will see the whole programme set out there. It is put on a rather rough basis, but at any rate it will be in that order. Perhaps the bon. Gentleman would care to look at it.

Mr. Ross: Will the Postmaster-General now extend the system to Kilmarnock, where we still have the manual exchange system and not the automatic system even for local calls?

Mr. Marples: I will certainly look at the position in Kilmarnock, which is a most important place.

Mr. Ross: Hear, hear.

Oral Answers to Questions — ROYAL AIR FORCE

Missile Bases

Mr. Stonehouse: asked the Secretary of State for Air which missile bases were officially visited by Senator Symington of the United States of America during his recent tour of Great Britain.

The Secretary of State for Air (Mr. George Ward): The Senator visited a missile site near Feltwell.

Mr. Stonehouse: In what capacity did the Senator make the visit, and will facilities be open to Members of the House?

Mr. Ward: The Senator made the visit as a distinguished American politician. I should welcome visits from hon. Members of the House.

Mr. Stonehouse: asked the Secretary of State for Air how many missile bases are up to operational standards.

Mr. Ward: A number of sites have been completed, but it would not be in the public interest to give figures. As regards the missiles themselves, the position remains as described by my hon. Friend the Under-Secretary of State on 22nd April.

Mr. Stonehouse: Is the right hon. Gentleman aware of the statement made by Senator Symington when he returned to the United States to the effect that none of the missile bases in Britain was up to operational standards? What has he done to check the accuracy of this statement?

Mr. Ward: The House has been told many times that Thor missiles at present in this country are used for training and will not become operational until after the successful completion of all the trials going on at Cape Canaveral.

Mr. Shinwell: Are we to understand from the right hon. Gentleman's reply that Senator Symington has received information about missile bases which is not available to hon. Members?

Mr. Ward: No, Sir. I have just said that if hon. Members would like to visit one of these missile bases I shall be delighted to show it to them.

Mr. Shinwell: The right hon. Gentleman just said that, in the public interest, he could not disclose the information. It now transpires that Senator Symington has the information. Why should Americans be given information denied to us?

Mr. Ward: All I said was that it would not be in the public interest to disclose how many bases had been completed. That is quite a different matter.

Mr. de Freitas: Will the Secretary of Stale make it quite clear that any hon. Member of the House who visits one of these stations—they are R.A.F. stations, not United States stations—will be given all the information which was given to Senator Symington when he recently visited this one?

Mr. Ward: I am not sure exactly what information was given to him, but I can assure hon. Members that I shall not deny them any information which I think would be in the national interest; but, obviously, there must be some security.

Mr. Stonehouse: asked the Secretary of State for Air what representations have been received by Her Majesty's Government from the United States Government about the inadequacy of missile bases established in Great Britain.

Mr. Ward: None, Sir. The United States Secretary of the Air Force has, in fact, expressed his satisfaction with what the two Air Forces have accomplished.

Mr. Stonehouse: Will the Secretary of State check on what information was made available to Senator Symington and make it available in the Library of the House, and will he say to what extent the United States authorities are responsible for these establishments? In view

of the present international situation, would it not be advisable to postpone their development?

Mr. Ward: The United States authorities are responsible for the provision of the missiles themselves and for the training of our personnel. We are responsible for the building of the sites.

Mr. de Freitas: Do not these Questions and Answers and the contradictory statements coming out of Washington by civilians and Service men emphasise once again how undesirable it was for the Government to make an agreement with the United States about these missiles, which brought the Royal Air Force into the party political battles in the United States? Is it not a most regrettable result of this Government agreement that the efficiency of R.A.F. officers and men has been called in question in the United States and that they have been put in a very embarrassing position?

Mr. Ward: I do not think that the conflict of opinion in the United States is any worse than the conflict of opinion which takes place between the hon. Gentleman and myself across the Floor of this House, and if he is worried about the Air Force view of this matter perhaps he would think about that himself.

Horsham St. Faith's Station

Sir F. Medlicott: asked the Secretary of State for Air how soon he anticipates being able to make a decision on the future róle of Horsham St. Faith's Royal Air Force Station, so that the arrangements concerning the provision of alternative routes to and from Norwich can be decided on.

Mr. Ward: We hope to put firm proposals to the highway authority very shortly.

Sir F. Medlicott: Is my right hon. Friend aware that some of the roads leading into Norwich have been closed for more than twenty years without any satisfactory alternatives being provided and that this announcement today will be very warmly welcomed throughout the county?

Knechtsand Island (Incident)

Mr. de Freitas: asked the Secretary of State for Air whether he will now make a statement on the representations made


to the Mayor of Hamburg on the recent incident concerning Knechtsand Island, North Germany.

Mr. Ward: Representations were made to the Mayor of Hamburg by H.M. Consul-General last week.

Mr. de Freitas: Since the Mayor of Hamburg is a most respected man and normally very reasonable, can the Secretary of State say whether he has yet had any expression of regret from the Mayor for his very inaccurate and rather wild statement?

Mr. Ward: No, Sir.

H-Bombs (Targets)

Mr. Emrys Hughes: asked the Secretary of State for Air if he will state the nature of the agreement that has been arrived at with the United States Air Force as to which targets will be attacked with hydrogen bombs in the event of war.

Mr. Ward: It would clearly not be in the public interest to give information about targets.

Mr. Hughes: Is the Secretary of State aware that considerable alarm has been displayed in this country owing to statements made in the Press, including a reputable Conservative paper, the Scotsman, which on 8th May said that Britain and the United States have agreed which targets should be attacked with H-bombs in the event of war, and which goes on to say that we have been allocated targets but that we have not enough H-bombs for that? Is not this provocative? Why are the Americans dictating policy which may mean suicide for this country?

Mr. Ward: While I fully share the hon. Member's respect for the Scotsman, I am sure he will not expect me to comment on newspaper reports.

University of the Air

Mr. de Freitas: asked the Secretary of State for Air what effect the opening of the University of the Air is expected to have on the recruiting of aircrew for the Royal Air Force.

Mr. Ward: The opening of the College cannot reduce the appeal of the Royal Air Force for men who wish to combine flying with the wide experience that Service life provides. These are the men we wish to attract.

Oral Answers to Questions — SHIPPING

Fishing Vessels (Navigational Aids)

Mr. Hector Hughes: asked the Minister of Transport and Civil Aviation how many and what proportion of ships in the British fishing fleets are and are not, respectively, fitted with the British Decca system of navigational aids; and what steps he is taking to ensure that new ships and also coal-burning ships converted into oil-burning ships are so equipped.

The Joint Parliamentary Secretary to the Ministry of Transport and Civil Aviation (Mr. John Hay): I am advised that some 900 fishing vessels are so equipped. This represents a high proportion of those vessels which have electric power available and which do their fishing within the coverage of existing Decca chains. Use of the equipment is not compulsory and we do not intend to make it so.

Mr. Hughes: Is it not an anomaly that any shipowners can be found who fail to use this protection against loss and damage, and will the Minister inquire into this anomaly with a view to taking steps by regulation or otherwise to see that the minority who do not use it are obliged to use it in future?

Mr. Hay: We have to keep the matter in perspective. There are approximately 9,500 British registered fishing vessels, of which about 2,100 are of 40 ft. or more. It is obviously only in the larger size vessels that this aid, which is extremely valuable, would be of use. It is, perhaps, worth noting that grants and loans are available from the White Fish Authority for the installation of generators in fishing vessels to enable them to make use of the Decca receiver.

Earnings

Mr. Awbery: asked the Minister of Transport and Civil Aviation what was the total contribution made by British shipping, both dry cargo ships and oil tankers, for each of the past five years, to the invisible exports of the United Kingdom; and what official action is being taken to develop and encourage this industry.

Mr. Hay: It is estimated that the United Kingdom dry cargo shipping industry made net contributions to the


United Kingdom balance of payments of £210 million in 1954, £240 million in 1955, £280 million in 1956 and £300 million in 1957. The provisional estimate for 1958 is £260 million. Similar estimates are not available for oil tankers. It is the Government's policy to encourage the expansion of world trade upon which the prosperity of British shipping depends.

Mr. Awbery: Is the Minister aware that this is a very substantial contribution to the country's revenue but that there are obstacles in the way of this industry developing? Is he aware that hon. Members have expressed in the House their dissatisfaction with the help given by the State? Will he take steps to overcome the difficulties in the way of development of the industry?

Mr. Hay: There are a number of difficulties affecting the industry which are not within our power to deal with. There are, for example, the trading practices of some of the maritime nations, as the House very well knows. We are doing what we can in conjunction with other maritime nations in Europe to investigate these to see whether some international agreement cannot be reached.

Roker Volunteer Life Brigade (Rockets)

Mr. Willey: asked the Minister of Transport and Civil Aviation on what grounds he has decided that the Roker Volunteer Life Brigade shall not be allowed to use rescue rockets for drills.

Mr. Hay: There has been a delay in the supply of rescue rockets for the use of Her Majesty's Coastguard and the Life Saving Brigades and Companies, but further supplies are expected in July. This has made it prudent to stop practice firings at drills for the time being. Existing stocks are ample for operational needs.

Mr. Willey: I am much obliged to the hon. Gentleman for that reply. Is he aware that his Department apparently has caused the mistaken view to be taken that this has been due to economy? Is he aware that the explanation could well serve a useful purpose in ensuring that the initiative and public spirit of these volunteers are not discouraged?

Mr. Hay: I welcome the opportunity of paying tribute to the volunteers to whom the hon. Member refers and of

saying that the last batch in supply was found to be faulty, which was the reason for this temporary breakdown. As I have said, by July we hope that things will be back to normal.

Merchant Ships (Replacement)

Mr. Rankin: asked the Minister of Transport and Civil Aviation what steps he proposes to take in order to secure agreement among shipowners in regard to a policy for replacing certain existing merchant ships; and if he will make a statement.

The Minister of Transport and Civil Aviation (Mr. Harold Watkinson): The replacement of merchant ships is primarily a matter for their owners. Where the Government is asked to take special action in the matter, I shall naturally keep in close touch with the industry.

Mr. Rankin: Has the right hon. Gentleman been in consultation at all with his hon. Friend the Civil Lord of the Admiralty, with whom I pressed this matter? I was referred to the right hon. Gentleman to pursue it. Can he say whether or not some policy is being devised for the replacement of existing ships, or will he consider it, as the United Kingdom shipbuilding industry is now in a most serious state with regard to new orders? Will he think about the matter?

Mr. Watkinson: I have several meetings this week with the Chamber of Shipping which are concerned with, for example, these international arrangements which we and other European nations think are very harmful to the shipping industry as a whole. It is in that sort of way that I hope we shall be able to help.

Dame Irene Ward: Does my right hon. Friend think that when he receives proposals from the Chamber of Shipping, and if he finds himself in agreement with them, he will be able to get support from the Chancellor of the Exchequer to do what is right by our industry?

Mr. Watkinson: I was not referring to subsidies.

Dame Irene Ward: Nor was I.

Mr. Watkinson: I was thinking of trying to improve the trading arrangements around the world so as to enable British shipowners to get more business.

Mr. Peyton: Even if the shipping industry is unable to put forward an agreed set of proposals, does not my right hon. Friend think that it is incumbent upon the Government to take such steps as they can to ensure that when the present serious recession declines the country will be in possession of a fast, modern, powerful and economic merchant fleet? Is this not of first importance to the country as a whole?

Mr. Watkinson: I do not disagree with anything that my hon. Friend has said, but the first problems with which we have to try to deal are those which are best summarised in the terms "flag of convenience" and "flag discrimination". It is those things which militate against the future development of the British shipping industry. It is to those things that I am giving my attention in co-operation with the Chamber of Shipping, and we hope soon to make some powerful representations to the American Government on this matter.

Oral Answers to Questions — CIVIL AVIATION

Belfast Airport

Mr. Knox Cunningham: asked the Minister of Transport and Civil Aviation if he will state the result of the study undertaken jointly by his Department and that of the Secretary of State for Air into the future use of the Royal Air Force station at Aldergrove, County Antrim; and whether he will make a statement as to the future of Belfast Airport.

Mr. Hay: My right hon. Friend expects to receive the report on the study very shortly. I am not therefore in a position to make a statement today.

Mr. Knox Cunningham: Could my hon. Friend say, when work is started to transfer Belfast Airport to Alder-grove, how long it will take? Will he bear very seriously in mind the fear among the present employees of any redundancy arising out of such transfer?

Mr. Hay: Yes. If we do decide, in the light of this report, to develop Alder-grove in place of Nutt's Corner it should take, I think, about two to three years before it can be completed. I will certainly keep in mind the point which my

hon. and learned Friend made about employment, about which he asked a Question some time ago.

Helicopter Stations

Mr. Awbery: asked the Minister of Transport and Civil Aviation if, in view of the rapid development of air transport and helicopter services, he will take steps to develop helicopter stations near large cities, or give powers to local authorities to develop them where they think it desirable in the interests of the city.

Mr. Hay: My right hon. Friend is watching with the greatest interest the development of the helicopter, but the local authorities are generally in the best position to provide helicopter stations near large cities. They already have the necessary powers, and I am glad that many have, with the Ministry's advice, already earmarked sites.

Mr. Awbery: Is the hon. Gentleman aware that the experiments which have been made with helicopters have all proved very successful and that some local authorities already have aerodromes and that local authorities want to develop these aerodromes but cannot do anything without assistance and encouragement from the State? Would the hon. Gentleman take the matter up with the Treasury with a view to getting assistance for local authorities to develop aerodromes?

Mr. Hay: We have given local authorities every encouragement and advice we possibly can. We published a pamphlet in 1956 on the planning of air stations for single-engine helicopters, and we have given further advice to 119 local authorities, including Bristol Corporation. I do not think it would be proper for me in answer to this Question to say that we would be willing to ask the Treasury or anyone else to make grants available, because this matter is still very much in the experimental stage.

Mr. Farey-Jones: Could my hon. Friend state quite clearly whether his Ministry would be prepared to accept any proposition by private interests to develop the use of helicopters throughout Britain, or is the future restricted to the national undertakings?

Mr. Hay: No. On the contrary, there is already one helicopter station, which I had the pleasure of opening a few days ago in London, which is operated by a private firm. There is nothing whatever to stop a private firm opening a helicopter station if it wishes, provided it can obtain the necessary planning permission, but our view is that this is a matter which, broadly, should be left to local authorities.

Mr. Beswick: Is the Minister aware that what local authorities want to know, when they are contemplating providing helicopter stations, is what the likely helicopter services are going to be? Does he share the optimism of my hon. Friend the Member for Bristol, Central (Mr. Awbery), who refers to the "rapid development of helicopter services"? Is he aware that it is now eight years since I had the privilege of inaugurating the first service between London and Birmingham? What advice has he given to local authorities about the likely outcome of inter-city services during the next ten years?

Mr. Hay: I think the hon. Gentleman knows that, quite apart from promotional or experimental schemes, helicopter services are just not economic and will not be till we get the bigger machines, like the Rotodyne, in service. We have to wait till that time comes. When it does, we shall be willing to consider what help we can give in developing the service.

Mr. Woodburn: Will the hon. Gentleman remember that areas where helicopters could be most serviceable are in the Highlands of Scotland, where transport by any other means is not very easy? Can he see any objection now to helicopters flying across water, in view of the fact that it seems to have been disposed of, as we read in the Press about air-sea rescue services and so on? Yet there seems to be a barrier to using helicopters to fly passengers across narrow waterways.

Mr. Hay: No, There is no barrier. The main trouble at the moment is that a helicopter service would not pay if it were based on the single-engine helicopter, since the sort of prices which would have to be charged for carriage would be so high that the ordinary traveller could not be expected to pay it. We have to wait

till the bigger helicopters come into service, for they will be more economic. We can then look at the Highlands and Islands, and so on..

Republic of Ireland (Reciprocal Flights)

Mr. N. Pannell: asked the Minister of Transport and Civil Aviation (1) if he will investigate the question of Aer Lingus flights originating in the Republic of Ireland being permitted to uplift passengers from the United Kingdom and transport them to the Continent, when private operators have been refused permission to operate services to transport British passengers over similar routes;
(2) if he will consult with the Government of the Republic of Ireland regarding permission for private operators in the United Kingdom to operate reciprocal flights to the Republic of Ireland.

Mr. Hay: Our agreements with the Irish Republican authorities already provide for flights between our two countries and beyond on a broad basis of reciprocity. If my hon. Friend has any particular case in mind where he considers the arrangements are not working satisfactorily and he will send me details, I shall be glad to investigate the matter.

Mr. Pannell: Is my hon. Friend aware that on the continental flights from Ireland Aer Lingus actually uplifts more passengers from the United Kingdom than it takes on board in Ireland? In those circumstances, is it not absurd to deny to private operators the right to transport those passengers from the United Kingdom to the Continent over similar routes?

Mr. Hay: Without notice, I could not comment on the figures mentioned by my hon. Friend, but, as I have explained, we have this agreement with the Irish authorities. It provides for reciprocal treatment, but if it happens that geography comes into it to some extent I am afraid that that is one of the consequences of geography itself. However, I am quite satisfied that the Irish Republic and Aer Lingus do not get any tremendous advantage out of this, because British airlines can operate in Ireland and do so.

Mr. Lipton: A very good impromptu answer.

Edinburgh and Glasgow Airports

Mr. Hector Hughes: asked the Minister of Transport and Civil Aviation if he will specify the nature and number of the complaints he has received, and from whom they came, about the loss and inconvenience caused to travellers to and from the north-east of Scotland to London by the unsuitability of the airports at Edinburgh and Glasgow, which involve travellers in delay waiting for connections; and if he will specify the suggestions he has received from such travellers and from experts to resolve these complaints by obviating the delay.

Mr. Hay: As I informed the hon. and learned Member on 6th May, we are not aware of any long delays or of any unsuitability of the facilities at these airports which might tend to create delays in this service. We have received no complaints or suggestions on the subject.

Mr. Hughes: Does the hon. Gentleman not realise that this is a long-standing grievance and an interference with the keeping of appointments in London and with the fulfilment of contracts? Will he look into this and see that business is properly served by obviating the delay which undoubtedly exists?

Mr. Hay: I find it difficult to follow the hon. and learned Member's supplementary question yin view of the Question he has asked about whether we have had complaints about the loss and inconvenience caused to travellers through the unsuitability of the airports involving travellers in delay. I can answer only for airports. If the hon. and learned Gentleman is complaining about schedules operated by B.E.A., I cannot answer be-ruse, as he knows, that is a matter of the day-to-day working of British European Airways.

Captain Thain

Mr. Remnant: asked the Minister of Transport and Civil Aviation how the independent reviewing body into Captain Thain's case will be constituted; what will be its terms of reference; and who will be members of it.

Mr. Watkinson: I have in mind that the reviewing body should consist of a Queen's Counsel; one person with appropriate scientific qualifications and a third person with flying experience.

Their task will be to consider the representations made by Captain Thain, and their precise terms of reference are now under consideration. Before finalising the arrangements for this independent review, I am waiting to know what action the German authorities propose to take on the further evidence by Captain Thain which has been submitted to them.

Mr. Remnant: Can my right hon. Friend say whether the inquiry will be held in public, or that at least a report will be published at the end of it? Will he also say that, pending the result of the report of the inquiry, his letter of 12th March, threatening to suspend the licence on renewal, can be considered as withdrawn?

Mr. Watkinson: The present position is that I do not propose to take any further action until we see whether the German authorities will agree to review this case. Obviously, if they should care to make any moves then it would be very much in Captain Thain's interest that no further action should be taken by my Ministry until we know whether or not the Germans are willing to change their views. As to the question of what we should do if we hold an inquiry, I will certainly study carefully what my hon. Friend has said. As to the letter to Captain Thain, that was not a threat to withdraw his licence. It was, I think, a very necessary warning so that he could take the action which he is now taking, that he should raise any matters in his defence if he thought there were any, so that my Ministry might consider them.

Mr. Beswick: I am sure that those in the House who have followed this case will be satisfied with the course of action which the Minister now proposes to take. In view of the fact that this is the first inquiry his Department has made into the accident, does he not think that the letter which he sent to this pilot was premature and that it has prejudiced the pilot's career? What justification was there for sending that letter to him and to his employers prior to an inquiry being made by his Department?

Mr. Watkinson: The answer to the first part of the question is that I do not think it has prejudiced Captain Thain's career. As the hon. Gentleman knows, his employers, British European Airways


have taken no action in this matter. Secondly, I thought it right and in his interests that he should have had the earliest possible warning that my Ministry might well consider the question of his licence. I think that has been in his interests, because it has enabled him to raise these other matters on which it is at least possible that the German inquiry will be re-opened.

Unscheduled Stops (Disembarkation)

Mr. Rankin: asked the Minister of Transport and Civil Aviation under what circumstances he permits passengers to disembark from an aircraft when it touches down at an airport other than its scheduled destination.

Mr. Hay: Provided a foreign aircraft enjoys traffic rights in the United Kingdom on the service in question, passengers are allowed to disembark at any point to which the aircraft is diverted. Foreign aircraft without traffic rights in the United Kingdom are allowed to disembark passengers where the aircraft is unable to proceed with its journey, or where exceptional hardship would otherwise be caused to the passengers.

Mr. Rankin: Yes, Sir, but could the hon. Gentleman say something about our own aircraft, those belonging to B.O.A.C.? Is he aware that on a recent flight across the North Atlantic the chairman and secretary of the Scottish Council of Development and Industry were unable to land at Prestwick as it was not the scheduled destination but had to travel on to London and then go back to Glasgow by train? Why was that so?

Mr. Hay: It was because the gentlemen concerned chose to travel by the Canadian Pacific Airways flight Vancouver-Amsterdam, which does not provide for anything other than a technical stop at Prestwick. Normally, it goes straight through, and since that line does not enjoy the right to set down and pick up passengers in the United Kingdom on that route it was natural that the passengers should have expected to go on to Amsterdam and return to London—in fact, many people do that.

Overhaul and Maintenance (Standards)

Mr. Beswick: asked the Minister of Transport and Civil Aviation what steps

are taken by his Department to ensure that companies granted a licence to carry out aircraft overhaul and maintenance continue to observe the technical standards required.

Mr. Watkinson: Organisations carrying out overhauls, repairs, replacements and modifications of civil aircraft are approved for these purposes on behalf of my Department by the Air Registration Board who regularly supervise them to ensure that proper technical standards are maintained.
Operators' maintenance organisations are not at present required to be so approved, but approval by the Board of the maintenance schedules for each type of aircraft is required. Compliance with these schedules must be certified by appropriately licensed aircraft maintenance engineers.

Mr. Beswick: Is the right hon. Gentleman aware that the impression created in the country now is that, while he is very quick off the mark to challenge the right of a pilot to hold a licence, he seems reluctant to take action in certain cases affecting companies charged with the responsibility for maintenance? In the light of recent incidents and criticism that has been made in public, can he say whether the inspection either by or on behalf of the A.R.B. into the maintenance schedules is carried out at sufficiently regular intervals?

Mr. Watkinson: If the hon. Gentleman is referring to a case which has recently been in the public notice, I certainly am not prepared to comment on it until I have received a report of the inquiry. As to the general issue which the hon. Gentleman has raised, I do not think that is so at all. My judgment is that, in general, these inspections of the approved firms and the general review of the schedules is carried out very strictly by the A.R.B.

Oral Answers to Questions — ROADS

Wall By-Pass

Mr. Snow: asked the Minister of Transport and Civil Aviation whether he is aware of the continued anxiety of the public at the delay in starting the construction of the by-pass at Wall,


Staffordshire; what reply he intends sending to the Lichfield Rural District Council in reply to their letter of 24th April; and what progress has been made concerning the undertaking he gave to the hon. Member for Lichfield and Tamworth on 18th February, 1959.

The Joint Parliamentary Secretary to the Ministry of Transport and Civil Aviation (Mr. Richard Nugent): The necessary Order establishing the route for the Wall by-pass scheme will soon be made and the Staffordshire County Council, as our agent authority, will then he invited to prepare the scheme to the contract letting stage. The date when constructional work can be started will depend on the funds available and the time it takes to acquire the necessary land. I cannot be precise at this stage, but the scheme will be proceeded with as soon as practicable.

Mr. Snow: Is the Joint Parliamentary Secretary aware that the answer sounds all right but that I hope that the delays which are implied in it will not be as disastrous as they sound? Is he aware that this matter has been the subject of Parliamentary Questions on several previous occasions? Does he not agree that his Department must look at this problem urgently? This is theoretically a main road and, by general consensus of local opinion, is at present regarded as extremely dangerous?

Mr. Nugent: What I have said in the substantive reply is the fact. We wish to proceed with this matter as quickly as possible. The hon. Member will know that there was an objection, which we have been considering, to the draft line. We hope to be able to clear that in the course of the next few weeks. I rather hope that we might be making the order this month. It is our intention then to proceed with all speed with the preparatory stages of acquiring land. We fully realise how important it is to get all this done.

Accidents

Mr. G. Wilson: asked the Minister of Transport and Civil Aviation how many persons were killed and how many injured, respectively, in road accidents per thousand registered vehicles using the roads in the years 1938, 1948 and 1958, or the latest convenient year for which the figures are available.

Mr. Nugent: The figures are 2.2 and 74.0 in 1938, 1.3 and 42.5 in 1948 and 0.8 and 39.2 in 1958.

Mr. Wilson: Can my hon. Friend say whether, notwithstanding the still very high accident rate, these figures indicate there has been a progressive improvement in the standards of driving and also in the safety devices incorporated in the design of motor vehicles?

Mr. Nugent: I think that they have some element of encouragement in them to the devoted band of people who do road safety work, but the total figures of killed and injured are so high, as my right hon. Friend has just said, that none of us has reason to be complacent.

Mr. Popplewell: Would it not be better to give the actual figures in addition to percentages or rates per thousand? There has been such a big increase in the amount of traffic on the roads compared with 1938, that a better perspective might be provided if actual figures were given instead of a comparison based on percentages.

Mr. Nugent: I have answered the Question on the Paper. If the hon. Member would like an answer to that point, perhaps he will table a Question.

Double White Lines

Mr. Gower: asked the Minister of Transport and Civil Aviation how many miles of roads in England and Wales, respectively, have double white lines; to what extent this system is to be extended; and if he will make a statement about the results of the experimental system to date.

Mr. Watkinson: In England about 450 miles and in Wales 80 miles of road have been marked on the new system, which will be progressively extended to all trunk and classified roads over the next few years. There is evidence that the demonstration lengths, unsupported by penalties, have improved traffic behaviour; I am satisfied that the extension of the system, on a mandatory basis, will promote the smoother and safer movement of traffic.

Mr. Gower: Has my right hon. Friend received representations as a result of any difficulties which have arisen so far from the experimental system

Mr. Watkinson: No, Sir, none of a major nature.

Viscount Hinchingbrooke: Is my right hon. Friend aware that on some roads the line painting is so divergent as to force a driver into the ditch in order to avoid breaking the law by crossing one of the lines? Will he look into that point?

Mr. Watkinson: I will certainly look into any examples which my noble Friend can give me.

Mr. Gower: asked the Minister of Transport and Civil Aviation what advice he has received on the new double white lines on roads in conditions of fog or very heavy rain; and what account his new regulations will take of difficulties which may arise in such conditions.

Mr. Nugent: Special care is always necessary in conditions of fog or heavy rain, and in such conditions motorists will find the new double white lines at bends and elsewhere more helpful than the single existing lines.

Mr. Gower: Yes, but is it proposed in suitable cases where the lines are on bends in roads to put double studs—cats' eyes—in case the ordinary white lines are not seen by the motorist?

Mr. Nugent: I am not quite clear what my hon. Friend wants to know, but if his question is directed to cats' eyes, we intend to continue using them just as we do now, and the cats' eyes will be placed where there are double white lines—

Mr. Gower: Double cats' eyes?

Mr. Nugent: —in between the double white lines on the road, in a single line.

Mr. Paget: Is there not a distinction between white lines which one must not cross and cats' eyes which one seeks to follow in thick weather, and ought not the cats' eyes to be put in two lines in the track where one is driving and not in the centre of the road?

Mr. Nugent: We have considered that, but we think on the whole that it would be less confusing to have a single line of cat's eyes.

Improvements, Rochester (Land)

Mr. Bottomley: asked the Minister of Transport and Civil Aviation what caused the delay in acquiring the land required for the road improvements of the Strood High Street from Rochester bridge to the railway bridge on the London-Canterbury-Dover trunk A.2 road.

Mr. Watkinson: Negotiations for the purchase of the land in this case have proved exceptionally difficult, and objections have been made to the draft compulsory purchase order. The scheme includes 21 plots of land of which 15 are business premises.

Mr. Bottomley: Why is the Minister so unsympathetic to the traffic problems of the Medway towns? Is he aware that the fact is clearly established that the bypass road ought to have been started before any other road? Secondly, is he aware that when the Rochester City Council is trying to got land to ease the road problems in this area his Department, with another Government Department, is niggling over a small amount of money, causing delay and great consternation in the city?

Mr. Watkinson: Perhaps I might ask: Why is the right hon. Gentleman so unsympathetic to the rights of private property holders who are affected by this scheme? I must say that people who have property—businesses, houses and farms—in the line of roads have every right to object and to have their objections heard, and I will not take any steps which will stand in their way.

Mr. Bottomley: Is it not a fact that the only outstanding difficulty now is one which concerns the Minister and the district valuer, that it is over a petty amount and that if this could be settled the road could be constructed?

Mr. Watkinson: A public inquiry has been arranged for 27th May, and so I should not comment further.

Oral Answers to Questions — TRANSPORT

Road Safety (Slogans and Posters)

Mr. Strauss: asked the Minister of Transport and Civil Aviation whether he will invite the Road Research Laboratory and the Royal Society for the Prevention of Accidents to initiate research into the value of different types of road safety slogans for display on wayside posters.

Mr. Watkinson: The programme of the Road Research Laboratory is very full and research in this subject would necessarily be extensive,


but the right hon. Member's suggestion will be borne in mind when additions to the programme are under consideration.

Mr. Strauss: I am glad to hear that. Would the right hon. Gentleman not agree that the present type of platitudinous slogan which says "Good driving pays" is a complete waste of effort, time and money? Would he not also agree that the selection of posters of this sort should not be left to amateurs but should be decided upon by experts on the basis of research? In view of the fact that effective posters can play quite a big part in reducing the toll of road accidents, is it not worth while initiating at an early date proper research into this problem?

Mr. Watkinson: The kind of poster used must be to some extent a matter of opinion, but I do not accept at all the right hon. Gentleman's aspersions on the present road safety programme, which, incidenally, is under the title "Be a better driver". I think that is a sensible appeal to thousands of new drivers coming on the roads. It is the view of experts, not amateurs, that if everybody became better drivers we should save many lives.

Sir G. Nicholson: Would my right hon. Friend not agree that the psychological approach to the public on any matter is most appropriately dealt with by experts in psyhcological approaches, namely, advertising and publicity firms? What can the Road Research Laboratory or anybody else be but amateurs in this respect?

Mr. Watkinson: I am willing, and the Department is willing, to accept help from anybody who can reduce some of the very tragic toll of life on the roads. The programme this year has been carefully conceived to appeal to drivers of motor vehicles, until July, when we propose to run again the theme of "Mind that child". I think that it is the right programme. Hon. Members will know that the local authorities are strongly supporting it, and perhaps I can persuade hon. Members to play their part too.

Third-Party Insurance

Mr. John Hall: asked the Minister of Transport and Civil Aviation which categories of persons are not covered by

compulsory third-party insurance to motor-car drivers.

Mr. Nugent: Broadly speaking, under section 36 of the Road Traffic Act, 1930, third-party insurance is not compulsory in respect of persons in the employ of the owner or other user of a motor vehicle, or, with certain statutory exceptions, private passengers.

Mr. Hall: Is my hon. Friend aware that this would seem to indicate that there is a gap in the existing legislation? Is it not a fact that passengers who are riding in a car, the driver of which is involved in an accident and held to be responsible, have no rights under third-party insurance and may, therefore, not be able to get compensation for injury? Should not that fact be made more widely known or an attempt made to cover it by legislation?

Mr. Nugent: I think it is generally known. Consideration has been given as to whether or no that extension should be made, but the thought behind the present situation is that the passenger knowingly takes the risk of travelling in the car with the driver, whereas in the case of the individual who is injured on the road by a car driven into him it is fortuitous.

Motor Cycles

Mr. Gower: asked the Minister of Transport and Civil Aviation what was the total number of motor cycles, auto-cycles, motor scooters and similar vehicles which were licensed in the United Kingdom at the latest convenient date; what were the total numbers in 1949 and 1939, respectively; and what is his estimate of the number which will be licensed in 1969.

Mr. Nugent: The number of motor cycles of all types licensed in Great Britain in the September quarter of 1958 was 1,475,101. Figures for 1939 are not available but the corresponding figures for 1938 and for 1949 were 443,651 and 634,536. If the number continues to increase at the rate of the years 1948 to 1958 there would be over 24 million by 1969.

Mr. Gower: Might not these figures be taken as one of many signs of the very remarkable rise in the standard of living which has occurred during the lifetime of this Government?

Oral Answers to Questions — RAILWAYS

Keighley and Oxenhope Line

Mr. C. R. Hobson: asked the Minister of Transport and Civil Aviation when he expects to receive the report of the appropriate consultative committee regarding the proposed closing of the Keighley and Oxenhope branch line railway; and if he will make a statement.

Mr. Nugent: I understand that no proposal for this line has yet been submitted to the Transport Users' Consultative Committee for the Yorkshire Area.

Mr. Hobson: Will the hon. Gentleman bear in mind that the loss on this branch line is negligible, being in the region of £1,200 per annum, that economies have already been agreed between the staff which would avoid that loss, and that if this line is closed it will literally isolate parts of my constituency in heavy, snowy weather?

Mr. Nugent: It is not for me to bear in mind that important information, but I am sure the Transport Commission will take note of what the hon. Gentleman has said.

Accident, Slough

Mr. Brockway: asked the Minister of Transport and Civil Aviation to make a statement on the railway accident at Slough on 1st May, 1959.

Mr. Watkinson: At 7.25 p.m. on Friday, 1st May, the 1.5 p.m. express train from Pembroke Dock to Paddington was approaching Slough station at about 70 m.p.h. when one of the bogies near the middle of the train was derailed when it passed over a broken rail. The last six coaches were completely derailed about 300 yards further on and one turned over on its side. The coupling parted between the third and fourth coaches and the front portion ran forward for another half a mile until stopped by the vacuum brake which came on automatically as a result of the parting. I am glad to say that although the train was crowded there were very few casualties—six persons were taken to hospital with minor injuries and fifteen others suffered from slight cuts or shock. The injured passengers received prompt aid and the others were conveyed to Paddington in a relief train.
The permanent way was seriously damaged, but by 6 p.m. on Sunday, 3rd May, repairs were completed appointed the Chief Inspecting Officer of Railways to hold an inquiry, which he opened on Monday. His investigations are not yet complete, but his report will be published in due course.

Mr. Brockway: While I thank the right hon. Gentleman for that very full statement, may I ask whether the inquiry which is taking place will be not merely into the causes of the accident but into the causes of the very happy event of so few casualties? Is it not the case that the fact that the train was equipped with buckeye couplings prevented the coaches from being scattered and turning over? If this is the case, will the right hon. Gentleman seek to extend throughout the whole of our railway system a device which prevents loss of life in this way?

Mr. Watkinson: As the hon. Gentleman knows, my Chief Inspecting Officers of Railways have very wide terms of reference, and their reports can make recommendations to the Commission, and customarily do so. I do not think the hon. Gentleman is wrong in his estimate of what saved a great many lives. It shows how the railway modernisation plan may well save lives as well as improve the railway system.

Branch Lines, Staffordshire

Mr. Harold Davies: asked the Minister of Transport and Civil Aviation what reports he has had from the appropriate area consultative committee about the closing of branch railway lines serving Leek, Staffordshire; whether he is aware that the proposed closure of these lines will drastically curtail Leek's transport facilities; and whether he will make a statement.

Mr. Nugent: I understand that since 1956 the British Transport Commission has put no proposals to the West Midland Transport Users' Consultative Committee for the closure of railway lines serving Leek.

Mr. Davies: We are fully aware that the Leek-Churnet line is to be closed. Is the Minister aware that the very active town of Leek, with its important industries, is completely cut off by rail from Manchester, Derby, Stoke-on-Trent and Macclesfield? Is it not time that we looked into the whole purpose of the railway system? Ought not hon. Members


on both sides of the House to ask themselves: is it to be a social service or must it all the time make a profit?

Mr. Nugent: I explained in answer to a previous Question that these points are not for me to answer. I do not doubt that the British Transport Commission will take note of what the hon. Gentleman has had to say.

Mr. Ernest Davies: Will the hon. Gentleman give an assurance that there has been no change in the procedure and that where it is proposed that a line shall be closed the matter is referred to the appropriate consultative committee? Is this not the second time today that lie has said that he is not aware of these proposals and that they have not been referred to the committee? Apparently there are proposals and these closures are taking place. Has there been any change in the procedure?

Mr. Nugent: There has been no change in procedure. I do not doubt that there are many rumours when the B.T.C. is contemplating action of this kind, but neither in this case nor in the other have any proposals been put to the consultative committee.

Mr. Popplewell: Is the Minister aware that the Government are entirely responsible for the British Transport Commission now running at a loss of about £90 million a year and that it is appalling that the Commission should have to close down branch lines and stations when they are showing a slight deficiency? Will he not have further consultations with his colleagues and with the Commission so that the people in the areas concerned can have a better deal than they are now having?

Mr. Nugent: I do not for a minute accept the implications in the hon. Member's question. For one thing, but for the fact that the Government are financing the larger part of the £1,500 million modernisation scheme British Railways would not be running at all.

Oral Answers to Questions — HARWELL ATOMIC ENERGY RESEARCH ESTABLISHMENT (DOCUMENTS)

Sir A. Hurd: asked the Prime Minister if he has inquired into the circumstances in which documents relating to Harwell Atomic Energy Research Establishment, including one marked Confidential," were left in the drawers of furniture sold as Government surplus and discovered last week by the purchaser, Mr. Boxshall, of Pound Street, Newbury; and if he will make a statement on the security measures taken to ensure that all such papers no longer required are destroyed under proper supervision.

The Paymaster-General (Mr. Reginald Maudling): I have been asked to reply.
Comprehensive regulations are in force throughout the Atomic Energy Authority for the control of classified documents, and for their destruction under proper supervision as necessary. In the incident referred to by my hon. Friend the documents were all unclassified. One was still marked "Confidential", though it was in fact no longer in that category. The Authority is reviewing its procedures to prevent the recurrence of incidents of this kind.

Sir A. Hurd: May we take it that any document which relates to secret establishments such as this one will be taken good care of and destroyed immediately there is no further use for it? Otherwise, are we to expect the Authority to set up as a kind of hidden treasure department to which people will pay high prices for its disused furniture in the hope of finding something in the drawers?

Mr. Maudling: Though that might be tempting, I am sure the Authority will not do so.

Mr. Gaitskell: Does the reply mean that it does not matter at all who saw the documents in question since the right hon. Gentleman said they were not classified? Does it mean that they were in no way secret?

Mr. Maudling: It means precisely that.

PERSONAL STATEMENT

The Joint Under-Secretary of State for Scotland (Mr. Niall Macpherson): With your permission, Mr. Speaker, and that of the House, I wish to make a short personal statement.
Yesterday, in reply to a supplementary to Question No. 37 put by my hon. Friend the Member for Ayrshire, Central (Mr. Nairn), in referring to appeals to the High Court of Justiciary in Scotland, I said:
legal aid is available."—[OFFICIAL REPORT, 12th May, 1959; Vol. 605, c. 1037.]
To avoid misunderstanding, I wish to make it clear that legal aid under the Legal Aid (Scotland) Act, 1949, is not available in such cases. I should add, however, that many members of the legal profession are prepared, in suitable summary appeal cases, to give their services free of charge, or at a fee fitted to the pocket of the appellant.
I wish to apologise if I misled the House.

BALLOT FOR NOTICES OF MOTIONS

Aged People

Mr. S. 0. Davies: I beg to give notice, that on Friday, 5th June, 1959, I shall call attention to the serious plight of our aged people, and move a Resolution.

Capitalism and Socialism

Mr. Lipton: I beg to give notice, that on Friday, 5th June, 1959, I shall call

attention to the defects in the capitalist system of society and to the benefits to be derived from the Socialist system, and move a Resolution.

London (Transport Conditions)

Mr. Skeffington: I beg to give notice, that on Friday, 5th June, 1959, I shall call attention to public transport conditions in London, and move a Resolution.

BILL PRESENTED

COTTON INDUSTRY

Bill to enable schemes made with a view to eliminating excess capacity in the cotton industry to provide for paying compensation for any such elimination and for raising the sums required for that and other purposes by levies on the industry; to enable the Board of Trade to make contributions towards any such compensation and to make grants for the re-equipment of the industry; and for purposes connected therewith, presented by Sir David Eccles; supported by Mr. kin Macleod, Mr. Erroll, and John Rodgers; read the First time; to be read a Second time tomorrow and to be printed. [Bill 106.]

BUSINESS OF THE HOUSE

Proceedings on Government Business exempted, at this day's Sitting, from the provisions of Standing Order No. 1 (Sittings of the House).—[Mr. Heath.]

TELEVISION (LIMITATION OF ADVERTISING)

3.35 p.m.

Mr. Christopher Mayhew: (Woolwich, East): I beg to move,
That leave be given to bring in a Bill to amend the Television Act, 1954, by prohibiting the broadcasting of advertisements for more than six minutes in any hour.
Some hon. Members may feel, and I know that many viewers do, that the figure of six minutes in the proposed Bill is rather high. All the evidence, including that of Gallup polls, shows that while a small number of viewers like the advertisements a very much larger number are annoyed by them. There is no doubt that the overwhelming majority of viewers feel that the amount of advertising today is wholly excessive.
Six minutes appears in the Bill because it is a step forward and because it is the figure which was mentioned by Government spokesmen during the proceedings on the Television Act as it passed through Parliament. On Second Reading, the then Home Secretary, now Lord Kilmuir, after explaining that this would be a decision for the I.T.A., said:
…I ought not to prophesy…but the sort of thing I envisage—I may be wrong—is five or six minutes to an hour."—[OFFICIAL REPORT, 25th March, 1954; Vol. 525, c. 1447.]
The Assistant Postmaster-General at that time said:
I have always envisaged that, so far as the spot advertisement is concerned, 10 per cent.—that is, six minutes an hour—would probably, or possibly, represent about what the Authority would regard as reasonable."—[OFFICIAL REPORT, 22nd June, 1954; Vol. 529, c. 245.]
Those statements were intended to reassure Parliament on that point. That is why they were made and they helped the passage of the Bill which was, at times, very difficult. Parliament undoubtedly felt—and it is a most reasonable interpretation—that what was meant was "six minutes in any hour", and this is what is included in my proposed Bill, which is based on a workable and easily understood principle and would still leave the programme contractors capable of making a huge profit.
We are now being told that the Government spokesmen at that time did not mean any of this, but meant an "average" of six minutes. If that is what

they meant, it is a pity that they did not make it clear at the time. It might have had a considerable effect on the passage of the Bill. But let us accept the idea of an "average" and look more closely at precisely what it means. It might mean that viewers, on the average, would see six minutes' advertising in the hour; that is to say, 1 million viewers could be shown seven minutes in an hour if they were also shown only five minutes' advertising in another hour. Viewers would then be seeing an average of six minutes, advertising in the hour. If that is what was meant by the spokesmen, it is still a pity, but at least it is not an unreasonable idea.
But what we are getting today is something totally different from that. The programme contractors know that though they can make a good profit on that basis they can make a very much greater profit if they concentrate their advertising at peak hours. Thus, a formula has been evolved which says that six minutes is to be the average for the whole day, that is to say, nine minutes is all right between nine and ten in the evening if it is balanced out by only three minutes between nine to ten in the morning. The two are compounded and make equivalent to "an average of six minutes in the hour." It means, in effect, that programme contractors may broadcast much more than six minutes when people are watching, provided that they broadcast much less when they are not.
This, the I.T.A. and the Postmaster-General tell us, is what the intention of Parliament was. That seems to me to be nonsense. That was not the intention of Parliament. In fact, it is a fraud and a very profitable fraud, as I shall now show. I have had the aid of the statistical department of the Library and I have made a careful analysis of London broadcasting for the latest convenient week, 27th April to 3rd May. The Television Press Agency, which provides clear and detailed logs of the commercials in the programmes, assures me that that week is in every respect typical. It shows that in normal viewing time, between seven and ten, the maximum was nine minutes' advertising in the hour, while the average over the whole normal viewing time was seven and a half minutes.
Over the whole period of the evening from five o'clock to eleven o'clock, if we include the advertising magazines, the


average was 8¼ minutes. On three occasions There were hours in which there were more than 20 minutes of advertising. On Wednesday, 29th April, the peak was reached with 21¾ minutes of advertising between ten and eleven o'clock in the evening. Ironically enough, and I cannot resist saying this, after 21¾ minutes of high-powered publicity, at eleven o'clock there was a personal appearance by Lord Montgomery of Alamein.
How much do the programme contractors gain by this, in my opinion fraudulent, formula? It is quite easy to work out a rough estimate. Again, with the assistance of the statistical department of the Library, I have worked out that by systematically exceeding an average of six minutes an hour between seven o'clock and ten o'clock one programme contractor alone, Associated Rediffusion, is making a fraction under £2 million a year. If one takes the whole period from five o'clock to eleven o'clock, and includes the advertising magazines, it is making £4 million a year. It must be surely about the most public piece of systematic looting in the history of the country.
Associated Rediffusion is now asking for another channel. It might be well advised to clean up its own affairs if it is to keep the channel that it has already. All the programme contractors, Granada, A.T.V., and T.W.W., are making huge sums by keeping programme time short and advertising time long. It might almost be said that financial success in programme contracting lies in contracting the programmes.
How does I.T.A. excuse all this? The Authority is, after all, responsible. It cannot admit what everyone knows, that the reason behind this is that the programme contractors make huge profits by concentrating their advertising at peak periods. It has to find some other reason for explaining the figures I have given. Perhaps I may read to the House the explanation given by the Director-General to my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman) and myself. In an agreed minute of the meeting Sir Robert Fraser said:
At the outset it seemed to the Authority that 10 per cent. of total time would be about right for advertisements, and the question then arose whether it should be spread evenly over

the day, or related to the capacity of various types of programme to bear advertising. The Authority had decided on a policy of flexibility operated by reference to defined categories of programmes. It was very rare for advertising to exceed eight minutes in a clock hour. He asked Mr. Mayhew and Mr. Chapman whether it did not see sensible to let advertising time out over a day in this way. Mr. Mayhew asked whether Sir Robert was implying that the concentration of advertisements in the more profitable peak hours was simply a coincidence. Sir Robert Fraser agreed that, of course, the factors which determined so-called peak hours were often also factors which determined the capacity of particular programmes to bear advertising.
Shortly afterwards I received a letter from the Director-General in which he said:
I do not wish at this stage to tinker with the record of our meeting on January 29th, but I see that, on one point, I expressed myself in so compressed a way as to be obscure—The point I was trying to express was this. Popular light entertainment programmes—are bound to attract 'peak' audiences. Such programmes are also able to bear more than an average amount of advertising without harm. On the other hand, programmes of serious discussions will, by and large, both attract smaller audiences and also be less able to bear advertising without harm.
The Postmaster-General has been more specific.

Mr. C. R. Hobson: Where is the right hon. Gentleman?

Mr. Mayhew: I notified the right hon. Gentleman that I was raising this matter. Defending the appearance of more than eight or nine minutes advertising in an hour, the Postmaster-General said, on 11th March, according to column 1239 of the OFFICIAL REPORT, that a lot depended on the nature of the programme, and so on.
But if it is true that it is the nature of a programme and not the time that it is shown that matters, surely the same type of programme should carry the same amount of advertising no matter when it was shown: but one has only to look at the log to see that this is totally untrue. There is nothing in it whatever. A light programme which appears at peak hours carries far more advertising than the same type of programme at off peak hours. Similarly, a serious programme at peak hours should carry less heavy a load than a light programme. In fact, however, serious programmes appearing at peak hours—they are very rare—carry just as much advertising as light programmes.


I.T.A.'s defence is untrue and disingenuous. As usual, it is covering up for the programme contractors; and, as usual, the Postmaster-General is covering up for I.T.A.
My proposed Bill will put the whole matter straight. It is a twin Bill to the Television (Commercial Advertisements) Bill, which would abolish breaks in programmes and which was introduced a short time ago. That Bill has great support in the country. On the basis of a Gallup poll, we can calculate that it was supported by between 17 million and 18 million I.T.V. viewers. I believe that this Bill, if allowed to go forward, would be supported by at least as large a majority of the I.T.V. viewing public.
It will be opposed, however, by a very powerful vested interest. The programme contractors are not only powerful because of their wealth or their patronage, but because of their financial links with many newspapers in the country, and they also have friends opposite. The Bill may, of course, as the previous Bill did, pass unopposed at this stage and be obstructed at a later stage: but I think that my hon. Friends and I are agreed that the Bill is a just one, that it is widely supported and that if we cannot get it through this Parliament we will get it through the next one.

Question put and agreed to.

Bill ordered to be brought in by Mr. Mayhew, Mr. Herbert Morrison, Mr. Ness Edwards, Mr. Charles Hobson, Mr. Francis Noel-Baker, Mr. Wedgwood Benn, Mr. George Darling, and Mr. Chapman.

TELEVISION (LIMITATION OF ADVERTISING)

Bill to amend the Television Act, 1954, by prohibiting the broadcasting of advertisements for more than six minutes in any hour, presented accordingly and read the First time; to be read a Second time upon Friday and to be printed. [Bill 107.]

Orders of the Day — FINANCE BILL

Considered in Committee [Progress, 12th May].

[Sir CHARLES MACANDREW in the Chair]

Clause 16.—(ALTERATIONS IN RELIEFS.)

3.50 p.m.

Mr. Douglas Houghton: I beg to move, in page 14, line 11, at the end to insert:
(2) In section two hundred and sixteen of the Income Tax Act, 1952 (dependent relatives), references to seventy-five pounds shall be substituted for references to sixty pounds (the amount indicating the relief), wherever the Occur.
I understand, Sir Charles, that it would be convenient with this Amendment to discuss the Amendment in page 14, line 27, at the end to insert:
(4) In sections two hundred and fourteen and two hundred and fifteen of the Income Tax Act, 1952 (which refer respectively to a person taking charge of widower's or widow's children or acting as his or her housekeeper, and to a relative taking charge of an unmarried person's young brother or sister), for the references to sixty pounds (which indicate the amount of the relief in each case) there shall be substituted references to seventy-five pounds.
We have now passed from indirect to direct taxation—from, "pay as you spend" to, "pay as you earn"—and other more painful forms of extraction. This is the first of a number of Amendments designed to improve personal reliefs. A number of Amendments on the Notice Paper in the names of my right hon. and hon. Friends and myself are designed to increase Income Tax allowances for certain personal circumstances. This Amendment deals with one of them, that relating to dependent relatives, and the associated Amendment relates to another, the housekeeping relief. Later, we shall consider some new Clauses which are designed, in some cases, to enlarge the scope of or relax the conditions relating to certain personal reliefs. There are also proposals for new personal reliefs. The Amendments and the new Clauses are part of our general approach to the tax reliefs in the Bill and by them we seek to redress the balance of reliefs between those who have much to gain from the reduction in the standard rate of tax and those in the lower Income Tax brackets


who benefit little from these very large tax reductions.
The Chancellor of the Exchequer, on several occasions, has justified concentrating practically the whole of the tax reliefs on reductions in the standard rate and the reduced rates of tax, to the exclusion of personal reliefs, on the ground that it is the turn of the standard rate—as if the standard rate were a petulant child tugging at the Chancellor's apron strings and demanding that it should have a turn. We believe that it is also the turn of those whose personal circumstances entitle them to some adjustment of their tax burden, and who should get more generous reliefs at a time when the Chancellor is able to introduce proposals for very large reductions in the standard rate and lower rates of tax.
We know, of course, that the Chancellor can argue that Income Tax reliefs can go only to those who pay tax, and that those who pay most tax must inevitably benefit most when reliefs are given. We know, also, that it can be argued that those in the lower Income Tax brackets can benefit from the Purchase Tax reductions which we discussed yesterday. But we believe that it is out of balance to make such a big reduction in the rates of tax without, at the same time, adjusting the reliefs.
Looking back, we find that the last time the standard rate of tax was reduced, in the Budget of April, 1955, the Lord Privy Seal, who was then the Chancellor, introduced reliefs in personal allowances as well as proposals to reduce the rates of tax. Although I quoted what he said in a speech which I made during the Second Reading debate on this Bill, I think it worth while to recall his words again today.
The right hon. Gentleman said:
This reduction in the rates of tax "—
that was a reduction of 6d. in the standard rate and 3d. in the reduced rates—
will bring relief to the individual taxpayer at all levels of income. But it will do nothing, of itself, to improve the points at which tax starts to be payable."—[OFFICIAL REPORT, 19th April, 1955; Vol. 540, c. 59.]
The right hon. Gentleman therefore supplemented the remission in the reduced rates by reliefs on smaller incomes, and he increased the personal allowance for single and married persons by £20 and

£30 respectively though he did, at the same time, adjust the bands of the reduced rates of tax.
The right hon. Gentleman also introduced the small incomes relief and increased the child relief. We find that in 1955, when the then Chancellor was proposing remissions of tax in respect of the standard rate amounting to £116 million, he proposed improvements in the single and married personal reliefs costing £17 million and an improvement in the child allowance costing £18 million. The introduction of the small income relief cost £750,000. When embarking on tax remissions on this scale that seems to us to be a better balance than is effected by the proposals of the Chancellor on this occasion. That is why we have put on the Notice Paper, in the form of Amendments and new Clauses, proposals which, taken together, seek to restore something of the balance which the lower income groups have lost by the proposed reduction of 9d. in the standard rate.
The Chancellor will probably say, "Well, I am very sorry, but the money has gone."In a colloquial phrase, he may say," Search me!" Because, by the acceptance by the Committee last night of Clause 14, the reductions in the standard rate and in the reduced rates were approved. We may be challenged, as were some of my right hon. and hon. Friends yesterday, "If you propose further reliefs on this scale, where do you intend to get the money?" To that, we should answer that had we introduced a Finance Bill this year, our Measure would have been better balanced. It would have been different in construction. There would 'have been some general fundamental differences between the proposals of the Chancellor and those which we should have introduced in the same set of economic and financial conditions.
Within the framework of this Bill we cannot give any precise answer to a question about where we should get the money. Moreover, this Committee has never accepted that doctrine as the basis for the discussion of Amendments to the Finance Bill. Had it done so, debates during the Committee stage would collapse and grievances would go unheard, because the answer, "I am unable to concede more tax reliefs on this occasion," would be conclusive, and bring effective discussion to an end.
We believe that even within the framework of the Chancellor's financial proposals there is still room for some, if not all, of the changes that we propose by this series of Amendments. We shall not be content with the sort of fulsome satisfaction which seemed to be expressed by hon. Members opposite when the Chancellor said he was prepared to allow a tractor with a produce box to wander 15 miles away from the farm instead of five; nor shall we be as excited as apparently were hon. Members opposite at the fact that a grit spreader and a snow plough can be given some concessions from the Excise Duty on vehicles.
There is room within the framework of the Chancellor's financial proposals for some substantial concessions other than those which he made the other day. We certainly wish to press some of our Amendments upon the right hon. Gentleman.

4.0 p.m.

Sir Alexander Spearman: Has the hon. Gentleman ever formed an estimate of the approximate cost of his present proposals?

Mr. Houghton: I shall be coming to that. I cannot keep within the rules of order and give the whole lot, so I hope that I may be permitted to make this general introductory statement that we are putting forward this series of proposals so that we need not explain them every time as we go along. This is part of a concerted drive to get more relief for people with smaller incomes, those upon whose shoulders Income Tax burdens bear most harshly, even though they are small taxpayers. After those remarks, I will come to the Amendment which I moved a few minutes ago.
That Amendment relates to dependent relative relief, and the one which we are debating with it to housekeeper relief. I must try to keep these two matters in some sort of relationship. Although there is nothing necessarily linking dependent relative and housekeeper reliefs, in both cases they have been the same and when they have moved they have done so at the same time and by the same amount. That fact rather ties them together though, unhappily from the point of view of the taxpayers with housekeepers, the cost of higher relief for housekeepers is very much smaller than the cost of improved relief for dependent relatives.
I will not go into the long history of these reliefs, because we discussed these matters last year. We had a short but interesting debate in June—as will be seen in the OFFICIAL REPORT for 17th June, 1958, beginning at col. 903—upon three associated Amendments, which included these two in relation to dependent relatives and housekeepers.
The dependent relative relief was at £50 from 1948 to 1953, and then it was increased to £60. The housekeeper relief was at £50 from 1931 to 1953, when it was increased to £60. In 1953, when those two reliefs were improved by £10 each, the relief for a daughter maintained by an infirm taxpayer was increased from £25 to £40, though it must be admitted that that did not come about until my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) moved an Amendment to that effect. These three reliefs were those improved in 1953, and none others.
In 1955, when the Chancellor of the day introduced a 6d. reduction in the standard rate of Income Tax and proposed improvements in personal reliefs, he left alone the housekeeper, dependent relative and daughter-maintained-by-infirm-taxpayer reliefs, but he did lift the single person's relief, as I have said, from £120 to £140, and the married man's personal relief from £210 to £240. He increased the child allowance from £85 to £100. The only change that he made in dependent relative relief was to lift the ceiling of income of the dependent relative for qualifying purposes, to take account of the increase in the level of the National Insurance retirement pension. I have mentioned those facts to show that not necessarily do all these reliefs move together. Some move together, but not all of them. The two which I am discussing now have moved together when they have moved at all.
There was a time when much more interest was taken on the Government side of this Committee on those reliefs than appears to be the case today. I see the hon. Member for Portsmouth, Langstone (Mr. Stevens) present. I noticed that during the debate on the Finance Bill, 1951, he headed the list of Members who wished to improve housekeeper relief. There was also the present Paymaster-General and the present Minister of Housing and Local Government and


Minister for Welsh Affairs, also seems to have done nothing more for taxpayers employing housekeepers than to put their rents up. There was Mr. Angus Maude, then Member for Ealing, South, and the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) and the hon. Member for Wokingham (Mr. Remnant), whom I saw in his place only a few minutes ago. It is true that they had to wait until 1953 to see a modest improvement in this relief, but I am sure that their interest in the housekeeper relief was not exhausted by that small reward after their strenuous efforts in 1951. Last year, all that the Financial Secretary to the Treasury had to say against these proposals was that they were costly. This year one might think that that objection to improving these reliefs could not be made, because the Chancellor has much more room to manoeuvre than he had a year ago.
I see that there is support for this Amendment from a quite unexpected quarter, The Accountant, which had an article in its issue for 9th May headed, "Finance Bill reactions." Judging from the objectivity and anonymity of its reports of our debates, one could assume that The Accountant is run by the B.B.C. Only Ministers are identified in utterances on these occasions, apparently. I see that I am referred to as "an Opposition Member", and for the moment I must be content with that.

Brigadier 0. L. Prior-Palmer: The hon. Member is an Opposition Member.

Mr. Houghton: I am not saying that it is not true, but that it is not the whole truth. I do happen to have a name as well, and I do not see the slightest reason why it should not be used occasionally, especially when it is attached to something that the paper is going to support.
Referring to something that I said during the Second Reading debate about the failure of the Chancellor to improve these reliefs, the housekeeper relief in particular, the comment of The Accountant is:
…this allowance seems to be very niggardly, compared with child allowance.
For this small mercy I am truly grateful. It assists the Amendment that I am putting to the Committee.
As the Financial Secretary to the Treasury pointed out last year, the depen

dent relative relief is more costly to improve than is the housekeeper relief. To improve the housekeeper allowance as we now propose, from £60 to £75, would cost, he said, approximately £750,000 a year, and to improve the dependent relative allowance by an equivalent amount, from £60 to £75, would cost more than £6 million. The latter figure surprised me when the Financial Secretary gave it last year. My own estimate had been very much smaller than that, but I have not the slightest reason to think that my figure was right and that the Financial Secretary's figure was wrong.
We should bear in mind in this connection an aspect of the dependent relative relief which makes for considerable distinction between some taxpayers and others. If right hon. and hon. Gentlemen on the Government benches had to give assistance to dependent relatives they would not be foolish enough to rely on dependent relative relief. Of course they would not. They would enter into a covenant, This is what the better-off taxpayers do. They enter into a covenant to pay any amount which may be within their means or suitable to their circumstances, for a period of more than six years. That would then, rank as a deduction from their own tax liability, and would be taxable income in the hands of the recipient, if the recipient were liable to tax at all.
There are tens of thousands of these covenants. I wonder that there are not more of them. I hereby give free tax avoidance advice to anyone who cares to listen. The way to deal with this matter is to make out a covenant, if one has sufficient security of income and stability of employment and wishes to do it in the most beneficial way from one's own point of view. One cannot, of course, do it to a child of one's own; that is outside the scope of this idea of course, though one can, make a covenant in the interest of other children. I am dealing here solely with the question of covenants in favour of dependent relatives. How much tax avoidance by way of relief for covenants in this field there is I do not know, but this emphasises that the dependent relative relief is the poorer man's relief for aged parents and those incapacitated by old age or infirmity.
I hope that the Financial Secretary will give us this afternoon something


different from the explanation that he gave last time. He cannot say that it is too costly and that the Chancellor could not afford it this time. The only explanation he can give surely, is that. although it would have cost several millions of pounds, the Chancellor could well have afforded it, but he decided to do something else. He decided on that something else in the perfectly sincere belief, I have no doubt, that that would be the best for the economy, but the economy must also take account of social and fiscal justice at a time when very big shots in the arm are being given to companies, to those who pay substantially on the standard rate and who will benefit most from the reliefs that the Chancellor has given.
It is not for me now to say how he should have reconstructed his proposals to enable this concession to be made. It would not need a very big reconstruction to make the concessions we are proposing and certainly less still to meet the proposal contained in the Amendment I have moved.

Mr. Geoffrey Stevens: The hon. Gentleman for Sowerby (Mr. Houghton) has made, as he always does, a very agreeable and highly persuasive speech. It was also very skilful in that, within the framework of two very limited Amendments, he managed to carry out quite a comprehensive survey of personal allowances in Income Tax as a whole.
I entirely agree with the hon. Member that the Opposition are in no way inhibited from discussing reliefs which cost a very great deal of money. Hon. Members opposite are fully entitled to do so, but it is a fact that the Chancellor has to count the cost and bear these things in mind in dealing with suggestions made in speeches, however agreeable they may be. I thought that two points of view did not come out very clearly from the speech of the hon. Member which, none the less, must be borne in mind.
First, I think it is for consideration that in certain circumstances reliefs are better given in other forms of taxation than in Income Tax. The whole question of the balance between direct and indirect taxation requires very careful consideration. I think it is for argument that to take more people out of Income Tax

altogether at this particular time is necessarily a desirable thing.
There is quite a case for giving every person a vested interest in the standard rate of Income Tax. People do not notice the payment of Purchase Tax as they do reductions from wages by P.A.Y.E. and when the Income Tax bills come along. That is a point for consideration; and the second one, which is uppermost in my mind at present, came to me very strongly when the hon. Member was referring to certain Amendments which were put forward in 1951. The point which came to my mind immediately was that the time must come when, whatever the party political bias or allegiance of the Chancellor, the standard rate of Income Tax as such has got to be very seriously considered.
4.15 p.m.
That is particularly so after a world war in which the standard rate went up to heights which I do not think the Labour Party would ever wish to see maintained for long in peacetime. Fourteen years after the end of the war, the standard rate is 7s. 9d. in the £, despite the 9d. reduction that we shall soon see operative when the Finance Bill becomes law. It is perfectly true that a very large proportion of that reduction does not go direct to people who have dependent relatives and expenses of that sort, but a reduction in the standard rate benefits industry. To the extent that it encourages industry, commerce and enterprise, everybody—whether paying Income Tax or not, or having dependent relatives or not—incurs a considerable and obvious benefit.
Despite the persuasiveness of the hon. Member's arguments, despite the line that I have taken on personal allowances before and shall do in future, I say that the judgment of my right hon. Friend on this occasion in concentrating in direct taxation on reduction of the standard rate was not only the right judgment but the only decision a responsible Chancellor of the Exchequer could this year have properly taken.

Mr. John Cronin: I wish to make one or two brief points in support of the Amendment so ably moved by my hon. Friend the Member for Sowerby (MT. Houghton). There are certain arguments in favour of the Amendment in equity and there are social and economic ones.
From the point of view of equity, there is no doubt that a dependent relative is a considerable burden. It seems unfortunate that the dependent relative allowance now compares so unfavourably with the wife or child allowance. A wife and children are normally a source of comfort and ratification to a taxpayer, yet. if he has the inconvenience of a dependent relative, his allowance is considerably less. It seems, also, that as there has been considerable inflation since the dependent relative allowance was increased in 1953, there is a strong argument for making the burden rather less than it is now.
From a social point of view, I think that in this country we are rather unfortunate in that dependent relatives are not given quite the same family status as they have in other countries. There is a tendency for young people to try to avoid taking over personal charge of elderly dependent relatives. I come personally into contact with this quite a lot. For instance, one finds that where a dependent relative has been the subject of a major operation in hospital, and it has been necessary for him or her to have a few months care and attention afterwards in the home of the family, it is common for the family to reject the liability and not to take the relative. This is a frequent occurrence. It seems to be a symptom of the whale attitude of the country towards dependent relatives. On the Continent, dependent relatives have a much more recognised status in the family and people are much more prepared to take over their care.
No one will suggest that a small increase in dependent relative allowance would revolutionise the system, but it would certainly be an additional inducement. There can be little doubt that the taxpayer would be more likely to do his family duties if there were an additional financial advantage. He certainly would not be deterred from doing so and there would be a marginal effect in swaying his decision.
It is also very important from the point of view of the psychology of the dependent relatives. They can feel that they are less of a burden if the taxpayer is receiving more financial consideration for looking after them. There can also be no doubt that there will be a saving

for the National Health Service if more dependent relatives are treated or looked after at home. Exactly the same argument applies to the finances of local authorities, which have often to provide shelter and accommodation for elderly people.
From the point of view of the housekeeper allowance, the same arguments on equity apply with regard to the burden and unfavourable comparison with the married person's allowance and child allowance. It is a curious anomaly that when a man who has been enjoying a personal allowance as a married man becomes a widower, and has to find someone to look after his children, he is put at a considerable financial Income Tax disadvantage. That seems to be quite an unreasonable anomaly.
From the social point of view, the housekeeper allowance exists, as its name implies, primarily for the benefit of children. As my hon. Friend the Member for Sowerby pointed out, the cost of this Amendment would be comparatively small. It would seem to be rather niggardly if the Chancellor rejected the Amendment, which will be of enormous benefit to so many children. I therefore trust that the Chancellor will, if possible, concede both the Amendments. There can be little excuse for his not conceding the Amendment with regard to the housekeeper allowance.

The Financial Secretary to the Treasury (Mr. J. E. S. Simon): I had occasion on the Finance Bill last year and I have occasion again this year to say how valuable it always is to follow the hon. Gentleman the Member for Sowerby (Mr. Houghton), who is an acknowledged master of this branch of the law and of the practice in our fiscal system. I do not doubt that later I shall have occasion to thank him for setting out with great clarity not only the background to this Amendment, but of subsequent Amendments, and I should like to take this opportunity of reiterating what I have said before, so that I shall not embarrass him on subsequent Amendments by saying it again.
The hon. Gentleman was followed by my hon. Friend the Member for Portsmouth, Langstone (Mr. Stevens), who is particularly adept in dealing with our fiscal system professionally, and who has shown over the years great interest in


these problems of allowances. Then we had from the hon. Gentleman the Member for Loughborough (Mr. Cronin) his own very valuable experience, although his medical experience in this respect was rather different from the circumstances when he was indirectly medically responsible for my own health, as he may remember.
I will deal, first, with the dependent relative allowance. The people who are the beneficiaries of this allowance have been dealt with quite favourably in recent years. As the hon. Gentleman the Member for Sowerby reminded us, this allowance and the housekeeper allowance were raised to £50 in 1943 and to £60 in 1953—percentage-wise quite a large increase. The matter does not end there because, as I ventured to point out on several occasions last year, the system of allowances is not really intended to compensate the taxpayer for the burden of the particular circumstances that are envisaged; on the contrary, as the Royal Commission pointed out, the part which these allowances play in the tax system is to take their place in the system of graduation in the tax burden. In a number of circumstances it is better to give assistance through the social services. Most of those who support dependent relatives have been greatly helped in recent years by successive increases in the retirement and widows' pensions. That has meant that the State is giving an increased contribution to the maintenance of their dependants.
Then again, as the hon. Gentleman the Member for Sowerby so fairly reminded us, there have been successive increases in the limits of the dependent's income which disqualifies a person on whom he is dependent from benefiting from this relief. We have reached the position where an income of £195 can be exempted from tax. That is £60 in the hands of the claimant and £135 of the dependent's income. That compares with a figure, which I shall have to emphasise later, of £180 at which a single person begins to pay tax.
As I have pointed out, the dependent relatives' allowance—this really takes up the point which the hon. Member for Loughborough made about the effect of the cost of living since the relief was last improved—is not intended, as the Royal Commission pointed out, to cover the full cost of maintaining a relative. Its purpose is to play a part in the system of

graduation. Therefore, to my mind, the hon. Member for Sowerby was quite right, at the very outset of his speech, in relating this Amendment to the rest of the series of Amendments which the Opposition, for the reasons which he gave, with perfect propriety in the circumstances, have put down.
The two reliefs which we are discussing on this Amendment necessarily move together; they always have moved together and there is no reason for differentiating between them, but they must also be viewed in the wider system of reliefs and allowances. It is against that background that I venture to make my next point.
At present, the full allowance of £60, as the Committee was reminded, is given for maintaining a dependent relative with an income not exceeding £135 a year, which, I think I am right in saying, was increased last year. There is also a tapering or marginal relief. If a relative's income exceeds £135, the allowance otherwise due to the claimant is cut down by £1 for each £1 of the increase, until the allowance runs out completely when the relative's income reaches £195. Thus the maximum amount of income which can be exempted from tax on account of a dependent relative in his own hands and the hands of the taxpayer who maintains him is now £195, that is, £60 plus £135. That is above the figure of £180 at which a single person pays tax.

Mr. Houghton: The hon. and learned Gentleman will not, of course, have overlooked the age exemption for a person over 65, which gives total exemption from tax on an income up to £275 in the case of a single person and £440 in the case of a married couple.

4.30 p.m.

Mr. Simon: I have that in mind. The hon. Member is right to remind the Committee of that fact, but I think that the Committee has always regarded that relief as exceptional. The circumstances have been made exceptional for aged persons enjoying that relief. In this case it is a question of comparing two people of similar age, and it therefore seems to me that the time for improving this relief—I think I made this point last year—is when we are improving the personal reliefs generally and that it would be wrong to change the dependent relative allowance or the housekeeper allowance until


we are ready to improve the personal allowances generally.
I know that the hon. and learned Member for Kettering (Mr. Mitchison) last year stigmatised that argument as "centipede trouble", saying, "You must not move one leg forward until you are ready to move the other ninety-nine forward." Nevertheless, if it is right, as I am sure it is, that this allowance and the housekeeper allowance are designed to play their part in the system of graduation, then by and large they ought to be changed together.
That brings me to the cost. The cost of the first Amendment is £5½ million in a full year. Last year, I gave the figure of £6 million. The difference is due to the reduction in the standard rate this year. The second Amendment, dealing with the housekeeper allowance, would cost about £750,000. Thus, a substantial sum of £6¼ million is at stake here. As I have said, however, one must consider the Amendments in the setting, which the hon. Member himself gave, of all the other allowances and, costing as best I can, it seems to me that the Amendments to the Clause which the Opposition have put down would cost £245¼ million at the 1959–60 rates and £2581 million at the 1958–59 rates. In other words, if we had not passed Clause 14, the cost would be considerably higher.
It is right for the hon. Member to say that that factor does not prevent the Amendments from being tabled as a basis for discussion. I do not think it does. It seems to me that it is a different matter, however, when we come to a vote. It is right to put it down to say "This is what we should have done"; but when it comes to a vote the Committee is in a different position, because the Committee has passed Clause 14 and has done so not even by a vote but without a dissentient voice being raised. The reduction in the standard rate effected by that Clause involves £128 million in a full year. The Opposition, quite rightly, would not wish to stop there, and the provisions for the reduction must also be extended to the reduced rates. That adds another £101 million in a full year.
Although we can have no possible complaint that this Amendment has been put down as a basis for discussion, I suggest that it would be irresponsible of the Committee to try to add to the reliefs

—which have been effected by way of reduction in the standard rates—these very substantial reductions in taxation through improving the allowances.
Both because of the cost and because of the reasons which I gave earlier, therefore, I cannot recommend the Committee to accept the Amendment. As my hon. Friend the Member for Langstone pointed out, my right hon. Friend thought it right this year to concentrate his reliefs on reduction of the standard rate. That has been approved by the Committee. Although the Opposition are entitled to have their point of view registered in the discussion, in my respectful submission the Committee ought to reject the Amendment.

Mr. G. R. Mitchison: Apparently we are allowed to talk but not to vote. This seems to me to be turning the procedure of the Committee upside down.
Of course, we should not have introduced the same Budget as that which the Chancellor has introduced and we have to look at the Clause in the light of what has been done. The Financial Secretary has justified it by graduation. As a Treasury poet put it, "Graduation is a lovely thing, God wot." I think that the hon. and learned Member pushed it so far, however, that he defeated his own ends. If graduation is to settle the matter and if this were the right relief when Income Tax was at a higher rate, now that the rate has been reduced this relief should be increased proportionately. If it were wrong previously, we have not heard that from the hon. and learned Gentleman. He gets up every year and, in the sacred name of proportion, defends that which was inconsistent the year before and no doubt will be inconsistent the following year.
That kind of argument merely defeats itself. Graduation may justify many things, but not complete illogicality. Ought we not to consider the matter on its merits? The hon. and learned Member relied on a distinction between the relief given in some cases of old age and the dependent relief allowance. I have never understood the principles which govern the Income Tax Acts. Sometimes I wonder whether there are any. When I look at the dependent relief allowance I find that the very case which is dealt


with is that of people incapacitated by old age or infirmity.
If we say that we should give special treatment in relation to old age in one case, why do we not give it in the other? If we are to have a spot of graduation in the matter, it might be a good plan to get these two things a little more similar than they are at present.

Mr. Simon: I am sure that the hon. and learned Member has the matter in mind, but for the sake of completeness I ought to say that the relief extends beyond that case to that of the taxpayer's or his wife's widowed mother, whatever her age or state of health.

Mr. Mitchison: I have it well in mind. When I am told that we cannot give this relief when we are giving greater relief in other cases because those other cases are cases of old age, I am entitled to point out that this relief also includes cases of old age and incapacity from old age. I am not saying that it does not include other cases, too, but if it is right to give relief in relation to people who are incapacitated through old age, then if we are to stick to the present form of relief it must also extend to the other types of case which are classed with those in the dependent relief allowance. That means incapacity, infirmity, and various other cases. Unless we go into the question of whether the whole class needs amending —and we cannot do so at the moment—we are considering only the question of amount.
I want to put forcibly to the Committee that what we are talking about is an increase in an amount between £20 and £25 at the standard rate by under £6. That is what it would be. We are discussing it in connection with a Budget which gives to every middle class taxpayer a relief considerably in excess of that. We are giving it in a Budget which leaves Surtax payers in the same position as they were in before. They therefore benefit from the reduction in the Income Tax rate, without any modification of Surtax. I am not discussing whether that is right or wrong, but that is the context in which we are considering this relief.
We are told that, if we are to take that matter into account, we must for the moment leave the field of graduation and consider the merits. I am only too

anxious to do so. When we come to the consideration of the merits, the Government's only answer is that these people have done quite well out of pension increases.
On this side of the Committee we dispute that. We are well aware that those pension increases have come largely not from central funds, but from increases in stamps and various other matters. I will not go into that now. We cannot regard it as appropriate to defend a refusal to give an Income Tax concession in cases of this kind on the ground that the people concerned may have had some increase in what is, after all, a totally different field and is largely financed from other sources.
We prefer to conclude that the Government deliberately prefer to give relief to the standard rate payer, however well off he may be, rather than to extend it, even by the comparatively small amount involved in the Amendment, to people who, on merit, have a far better claim.
The hon. Member for Portsmouth, Langstone (Mr. Stevens) defends this by saying that we must at all costs support the interests of industry, commerce and enterprise. I agree entirely, but I have never understood the logic of the Income Tax Acts in matters of this kind. If a merchant or an industrialist incurs expenditure, he is allowed to deduct that in full before arriving at his profits or gains. On the other hand, if someone takes in a dependent relative, and thereby has to pay out a great deal more money than these allowances represent, he is not allowed the loss of his personal income which results from that. He is only given an allowance which, admittedly, does not meet the loss he thereby suffers.

Mr. Stevens: Will not the hon. and learned Member for Kettering (Mr. Mitchison) agree that the savings from the incomes of companies are taxed at the full standard rate?

Mr. Mitchison: What I am concerned with now is a deduction which is made on the grounds that the taxpayer, be he a company in the one case or an individual in the other, incurs an expense. There is not the least doubt that, in relation to these dependants, the individual incurs an expense which, admittedly, is far greater than any relief we can give


him. Therefore, if we are to look at the question from that point of view, I fail completely to see the reason for not having a much larger scale of allowances than we have ever had.
I return to what I said at the beginning. These are the really hard cases. If we do not give an adequate concession to these people, in many cases we may be denying them the opportunity of carrying out family duties which they wish to carry out. They should, on every ground of fairness and morality, have their relief increased, if the reliefs given to other people, companies or individuals, are being increased on the scale by which they are increased in the Budget.
4.45 p.m.
I agree with the hon. and learned Gentleman when he talks about graduation. It is a matter of graduation, but he is breaking away from the very principle he puts forward. He prefers to give advantages to those who do not

stand in need of them so sorely as the people whom we are considering in the Clause. I cannot understand properly the principles of taxation. I cannot understand the motives which have led to some of the differences in taxation, particularly the point I have now been discussing. Most of all, I cannot understand the moral principles of a party which prefers to give such very considerable advantages to some people and, at the same time, denies this measure of relief to people who merit it far more. The only answer of hon. Members opposite is the thin and "phoney" plea for graduation, "They are doing well enough on pensions". Let hon. Members opposite try to live on pensions if that is what they think.

Question put, That those words be there inserted:—

The Committee divided: Ayes 198, Noes 237.

Division No. 107.]
AYES
[4.47 p.m.


Abse, Leo
Ede, Rt. Hon. J. C.
Jones, Jack (Rotherham)


Ainsley, J. W.
Edwards, Rt. Hon. John (Brighouse)
Jones, J. Idwal (Wrexham)


Albu, A. H.
Edwards, Rt. Hon. Ness (Caerphilly)
Kenyon, C.


Allaun, Frank (Salford, E.)
Edwards, W. J. (Stepney)
Key, Rt. Hon. C. W.


Allen, Arthur (Bosworth)
Evans, Albert (Islington, S.W.)
King, Dr. H. M.


Allen, Scholefield (Crewe)
Fernyhough, E.
Lawson, G. M.


Awbery, S. S.
Forman, J. C.
Lee, Frederick (Newton)


Bacon, Miss Alice
Fraser, Thomas (Hamilton)
Lee, Miss Jennie (Cannock)


Balfour, A.
Gaitskell, Rt. Hon. H. T. N.
Lewis, Arthur


Bence, C. R. (Dunbartonshire, E.)
Gibson, C. W.
Lipton, Marcus


Benn, Hn. Wedgwood (Bristol, S.E)
Gooch, E. G.
Mahon, Dr. J. Dickson


Benson, Sir George
Gordon Walker, Rt. Hon. P. C.
McAlister, Mrs. Mary


Bevan, Rt. Hon. A. (Ebbw Vale)
Greenwood, Anthony
MacColl, J. E.


Blackburn, F.
Grenfell, Rt. Hon. D. R.
Mcinnes, J.


Blenkinsop, A.
Grey, C. F.
McKay, John (Wallsend)


Blyton, W. R.
Griffiths, David (Rother Valley)
McLeavy, Frank


Boardman, H.
Griffiths, Rt. Hon. James (Lianelly)
MacPherson, Malcolm (Stirling)


Bonham Carter, Mark
Griffiths, William (Exchange)
Mann, Mrs. Jean


Bottnmley, Rt. Hon. A. G.
Grimond, J.
Marquand, Rt. Hon. H. A.


Bowden, H. W. (Leicester, S.W.)
Hale, Leslie
Mason, Roy


Bowen, E. R. (Cardigan)
Hall, Rt. Hn. Glenvil (Colne Valley)
Mayhew, C. P.


Bowles, F. G.
Hamilton, W. W.
Mitchison, G. R.


Brockway, A. F.
Hannan, W.
Monslow, W.


Broughton, Dr. A. D. D.
Hastings, S.
Moody, A. S.


Brown, Thomas (Ince)
Hayman, F. H.
Morris, Percy (Swansea, W.)


Burke, W. A.
Henderson, Rt. Hn. A. (Rwly Regis)
Mort, D. L.


Burton, Miss F, E.
Herbison, Miss M.
Moss, R.


Butler, Herbert (Hackney, C.)
Hewitson, Capt. M.
Moyle, A.


Butler, Mrs. Joyce (Wood Green)
Hobson, C. R. (Keighley)
Mulley, F. W.


Carmiohael, J.
Holman, P.
Neal, Harold (Bolsover)


Castle, Mrs. B. A.
Holmes, Horace
Noel-Baker, Francis (Swindon)


Champion, A. J.
Holt, A. F.
Noel-Baker, Rt. Hon. P. (Derby, S.)


Chetwynd, G. R.
Houghton, Douglas
Oliver, G. H.


Cliffe, Michael
Hughes, Cledwyn (Anglesey)
Oram, A. E.


Coldrick, W.
Hughes, Emrys (S. Ayrshire)
Orbach, M.


Collick, P. H. (Birkenhead)
Hughes, Hector (Aberdeen, N.)
Oswald, T.


Corbet, Mrs. Freda
Hunter, A. E.
Owen, W. J.


Cove, W. G.
Hynd, H. (Accrington)
Palmer, A. M. F


Craddock, George (Bradford, S.)
Hynd, J. B. (Attercliffe)
Parker, J.


Cronin, J. D.
Irvine, A. J. (Edge Hill)
Parkin, B. T.


Grossman, R. H. S.
Irving, Sydney (Dartford)
Paton, John


Cullen, Mrs. A.
Isaacs, Rt. Hon.G. A.
Pearson, A.


Davies, Ernest (Enfield, E.)
Janner, B.
Peart, T. F.


Davies, Stephen (Merthyr)
Jay, Rt. Hon. D. P. T.
Pentland, N.


Deer, G.
Jeger, George (Goole)
Plummer, Sir Leslie


Delargy, H. J.
Jeger, Mrs. Lena(Holbn &amp; St. Pncs, S.)
Popplewell, E.


Diamond, John
Jones, Rt. Hon. A. Creech(Wakefield)
Prentice, R. E.




Price, Philips (Gloucestershire, W.)
Simmons, C. J. (Brierley Hill)
Watkins, T. E.


Probert, A. R.
Slater, J. (Sedgefield)
Weitzman, D.


Purley, Cmdr. H.
Snow, J. W.
Wells, Percy (Faversham)


Rankin, John
Sorensen, R. W.
Wells, William (Walsall, N.)


Redhead, E. C.
Soskice, Rt. Hon. Sir Frank
Wheeldon, W. E.


Reeves, J.
Sparks, J. A.
White, Henry (Derbyshire, N.E.)


Reid, William
Spriggs, Leslie
Wilkins, W. A.


Reynolds, G. W.
Stewart, Michael (Fulham)
Willey, Frederick


Rhodes, H.
Stones, W. (Consett)
Williams, Rev. Llywelyn (Ab'tillery)


Robens, Rt. Hon. A.
Strauss, Rt. Hon. George (Vauxhall)
Williams, Rt. Hon. T. (Don Valley)


Roberts, Albert (Normanton)
Summerskill, Rt. Hon. E.
Willis, Eustace (Edinburgh, E.)


Roberts, Goronwy (Caernarvon)
Sylvester, G. 0.
Wilson, Rt. Hon. Harold (Huyton)


Robinson, Kenneth (St. Pancras, N.)
Taylor, Bernard (Mansfield)
Winterbottom, Richard


Rogers, George (Kensington, N.)
Thomas, lorwerth (Rhondda, W.)
Woodburn, Rt. Hon. A.


Ross, William
Thomson, George (Dundee, E.)
Woof, R. E.


Royle, C.
Thornton, E.
Yates, V. (Ladywood)


Shinwell, Rt. Hon. E.
Tomney, F.
Zilliacus, K.


Short, E. W.
Viant, S. P.



Silverman, Julius (Aston)
Wade, D. W.
TELLERS FOR THE AYES:


Silverman, Sydney (Nelson)
Warbey, W. N.
Mr. John Taylor and Mr. J. T, Price




NOES


Agnew, Sir Peter
Erroll, F. J.
Lehurn, W. G.


Aitken, W. T.
Farey-Jones, F. W.
Legge-Bourke, Maj. E. A. H.


Allan, R. A. (Paddington, S.)
Fell, A.
Legh, Hon. Peter (Petersfield)


Amery, Julian (Preston, N.)
Finlay, Graeme
Lindsay, Hon. James (Devon, N.)


Amory, Rt. Hn. Heathcoat(Tiverton)
Fisher, Nigel
Lindsay, Martin (Solihull)


Anstruther-Gray, Major Sir William
Fletcher-Cooke, C.
Linstead, Sir H. N.


Arbuthnot, John
Fort, R.
Lloyd, Maj. Sir Guy (Renfrew, E.)


Armstrong, C. W.
Fraser, Hon. Hugh (Stone)
Longden, Gilbert


Ashton, H.
Freeth, Denzil
Loveys, Walter H.


Atkins, H. E.
Galbraith, Hon. T. G. D.
Low, Rt. Hon. Sir Toby


Baldock, Lt.-Cmdr. J. M.
Gammans, Lady
Lucas, Sir Jocelyn (Portsmouth, S.)


Baldwin, Sir Archer
George, J. C. (Pollok)
Lucas-Tooth, Sir Hugh


Barber, Anthony
Glover, D.
Macdonald, Sir Peter


Barlow, Sir John
Glyn, Col. Richard H.
McLaughlin, Mrs. P.


Barter, John
Godber, J. B.
Maclean, Sir Fitzroy (Lancaster)


Batsford, Brian
Goodhart, Philip
Macleod, Rt. Hn. lain (Enfield, W.)


Baxter, Sir Beverley
Gough, C. F. H.
McMaster, S. R.


Bearnish, Col. Tinton
Gower, H. R.
Macmillan, Rt. Hn. Harold(Bromley)


Bell, Philip (Bolton, E.)
Graham, Sir Fergus
Maitland, Cdr.J.F. W.(Horncastle)


Bell, Ronald (Bucks, S.)
Grant, Rt. Hon. W. (Woodside)
Maitland, Hon. Patrick (Lanark)


Bevins, J. R. (Toxteth)
Grant-Ferris, Wg Cdr. R. (Nantwich)
Markham, Major Sir Frank


Biggs-Davison, J. A.
Green, A.
Marlowe, A. A. H.


Birch, Rt. Hon. Nigel
Gresham Cooke, R.
Marples, Rt. Hon. A. E.


Bishop, F. P.
Grimston, Hon. John (St. Albans)
Marshall, Douglas


Black, Sir Cyril
Grosvenor, Lt.-Col. R. G.
Mathew, R.


Body, R. F.
Gurden, Harold
Mawby, R. L.


Boyd-Carpenter, Rt. Hon. J. A.
Hall, John (Wycombe)
Maydon, Lt.-Comdr. S. L. C.


Boyle, Sir Edward
Hare, Rt. Hon. J. H.
Medlicott, Sir Frank


Braine, B. R.
Harris, Reader (Heston)
Milligan, Rt. Hon. W. R.


Brewis, John
Harrison, A. B. C. (Maldon)
Molson, Rt. Hon. Hugh


Brooman-White, R. C.
Harvey, John (Walthamstow, E.)
Morrison, John (Salisbury)


Browne, J. Nixon (Craigton)
Heald, Rt. Hon. Sir Lionel
Mott-Radclyffe, Sir Charles


Burden, F. F. A.
Heath, Rt. Hon. E. R. G.
Nairn, D. L. S.


Butler, R t. Hn.R.A. (Saffron Walden)
Henderson, John (Cathcart)
Heave, Airey


Campbell, Sir David
Henderson-Stewart, Sir James.
Nicholls, Harmar


Carr, Robert
Hicks-Beach, Maj. W. W.
Nicholson, Sir Godfrey (Farnham)


Cary, Sir Robert
Hill, Mrs. E. (Wythenshawe)
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)


Channon, H. P. G.
Hill, John (S. Norfolk)
Noble, Michael (Argyll)


Chichester-Clark, R.
Hinchingbrooke, Viscount
Nugent, Richard


Clarke, Brig. Terence (Portsmth, W.)
Hirst, Geoffrey
Oakshott, H. D.


Cole, Norman
Holland-Martin, C. J.
Ormsby-Gore, Rt. Hon. W. D.


Conant, Maj. Sir Roger
Hornhy, R. P.
Orr-Ewing, C. Ian (Hendon, N.)


Cooke, Robert
Horobin, Sir Ian
Osborne, C.


Cordeaux, Lt.-Col. J. K.
Horsbrugh, Rt. Hon. Dame Florence
Page, R. G.


Corfield, F. V.
Howard, John (Test)
Pannell, N. A. (Kirkdale)


Craddock, Beresford (Spelthorne)
Hughes Hallett, Vice-Admiral J.
Partridge, E.


Crosthwaite-Eyre, Col. 0. E.
Hughes-Young, M. H. C.
Peel, W. J.


Crowder, Sir John (Finchley)
Hurd, Sir Anthony
Peyton, J. W. W.


Crowder, Petre (Ruislip—Northwood)
Hutchison, Michael Clark(E'b'gh, S.)
Pickthorn, Sir Kenneth


Cunningham, Knox
Hyde, Montgomery
Pike, Miss Mervyn


Currie, G. B. H.
Hylton-Foster, Rt. Hon. Sir Harry
Pilkington, Capt. R. A.


Dance, J. C. G.
Iremonger, T. L.
Pitman, I. J.


Davidson, Viscountess
Jenkins, Robert (Dulwich)
Pott, H. P.


D'Avigdor-Goldsmid, Sir Henry
Jennings, Sir Roland (Hallam)
Powell, J. Enoch


de Ferranti, Basil
Johnson, Eric (Blackley)
Price, David (Eastleigh)


Dodds-Parker, A. D.
Joseph, Sir Keith
Prior-Palmer, Brig. 0. L.


Doughty, C. J. A.
Kerby, Capt. H. B.
Ramsden, E.


du Cann, E. D. L.
Kerr, Sir Hamilton
Rawlinson, Peter


Duncan, Sir James
Kirk, P. M.
Redmayne, M.


Eden, J. B. (Bournemouth, West)
Lambton, Viscount
Rees-Davies, W. R.


Emmet, Hon. Mrs. Evelyn
Lancaster, Col. C. G.
Remnant, Hon. P.


Errington, Sir Eric
Langford-Holt, J. A.
Renton, D. L. M.



Leavey, J. A.








Ridsdale, J. E.
Studholme, Sir Henry
Walker-Smith, Rt. Hon. Derek


Robertson, Sir David
Summers, Sir Spencer
Wall, Patrick


Robinson, Sir Roland (Blackpool, S.)
Taylor, Sir Charles (Eastbourne)
Ward, Rt. Hon. G. R. (Worcester)


Roper, Sir Harold
Taylor, William (Bradford, N.)
Ward, Dame Irene (Tynemouth)


Ropner, Col. Sir Leonard
Teeling, W.
Watkinson, Rt. Hon. Harold


Russell, R. S.
Temple, John M.
Webbe, Sir H.


Sharpies, R. C.
Thomas, Leslie (Canterbury)
Webster, David


Simon, J. E. S. (Middlesbrough, W.)
Thorneycroft, Rt. Hon. P.
Whitelaw, W. S. I.


Spearman, Sir Alexander
Thornton-Kemsley, Sir Colin
Williams, Paul (Sunderland, S.)


Speir, R. M.
Turner, H. F. L.
Wills, Sir Gerald (Bridgwater)


Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)
Turton, Rt. Hon. R. H.
Wilson, Geoffrey (Truro)


Stanley, Capt. Hon. Richard
Tweedsrnuir, Lady
Wood, Hon. R.


Stevens, Geoffrey
Vane, W. M. F.
Woollam, John Victor


Steward, Harold (Stockport, S.)
Vaughan-Morgan, J. K.
Yates, William (The Wrekin)


Steward, Sir William (Woolwich, W.)
Vickers, Miss Joan



Stoddart-Scott, Col. Sir Malcolm
Vesper, Rt. Hon. D. F.
TELLERS FOR THE NOES:


Storey, S.
Wakefield, Edward (Derbyshire, W.)
Colonel J. H. Harrison and


Stuart, Rt. Hon. James (Moray)
Wakefield, Sir Wavell (St. M'lehone)
Mr. Bryan.

Mr. Stevens: I beg to move, in page 14, line 15, to leave out "third" and to insert "next".
I read subsection (2) of the Clause with great care and I saw the reference to the third £150. I spent some time diligently searching for the first £150 and the second £150. I was able to find only one, and I think that this must be a drafting error. The substitution of the word "next" for the word "third" would give the subsection the meaning which my right hon. Friend would like it to have.

Mr. Simon: It seems to me that my hon. Friend the Member for Portsmouth, Langstone (Mr. Stevens) has a good point. After being in trouble the other day for using the word "confidentiality", I hasten to put myself right with the Committee by accepting the Amendment.

Mr. Harold Wilson: Will the hon. and learned Gentleman say how much the acceptance will cost the Exchequer?

Amendment agreed to

Mr. H. Wilson: I beg to move, in page 14, line 23, at the end to insert:
and for the words '£60', '£210' and '£360', in each place where they occur, there were substituted respectively the words '£100'. '£250' and £E400.'".
I ought to begin by saying that the words used by my hon. Friend the Member for Sawerby (MT. Houghton) when moving the first Amendment we took this afternoon should be taken as governing this Amendment and most of the others that we have tabled.
This is part of a series of Amendments which we feel would give a better way of disposing of this part of the Chancellor's surplus than some of the things he has done. We propose to restore the lowest band, the first band, at reduced rates of tax to £100, the figure at which it stood

until 1955. It will be recalled that, in the 1955 Budget, which went through rather rapidly without the degree of constructive criticism which would normally be given—no one complains of that—the then Chancellor, the Lord Privy Seal, reduced this first band from £100 to £60. He took 6d. off the standard rate and 3d. off each of the reduced rates.
The right hon. Gentleman said:
I want, therefore, to supplement the 3d. remission in the reduced rates by an improvement on the lines suggested by the Royal Commission. I have been impressed by the principles which lie behind its proposals for relief for the smaller incomes, and I therefore, propose, in addition, to exempt many of such incomes from all liability to tax by increasing the personal allowance—from £120 to £140 for a single person and from £210 to £240 for a married couple—while reducing the band of income taxable at the lowest rate from £100 to £60.
In other words, this was a rather smart piece of work by the then Chancellor which went through, I think, without the degree of comment which, perhaps, it would have evoked at other times, because, having altered the personal allowances, he then, in effect, took the amount off the lowest band of tax instead of putting it right up through the system.
The right hon. Gentleman went on to say:
By this means, I shall achieve, though in a simpler way, the object the Royal Commission had in mind in proposing its scheme for a minimum earned income relief"— [Of At. REPORT, 19th April, 1955; Vol. 540, c. 59.]
5.0 p.m.
Before the 1955 Budget the various bands of tax were as follows: the first one was £100 at 2s. 6d., the second £150 at 5s. and the next £150 at 7s., the standard rate then being 9s. After the April, 1955, Budget, the reduced rate bands became £60, £150 and £150, the rates being respectively 2s. 3d., 4s. 9d. and


6s. 9d., and the standard rate being 8s. 6d. These bands have remained at this figure until this year, and so, indeed, have the rates. The Chancellor has proposed to take 6d. off each of the reduced rates, but, while there is this reduction of 6d. in the rates, the size or width of the band—it is a little difficult to choose the right metaphor—remains the same; that is to say, the standard rate becomes chargeable after the first £360 of taxable income, whereas up to 1955 the standard rate was only chargeable after the first £400 of taxable income.
Our Amendment proposes to increase the amount at the lowest rate of tax from £60 to £100, and that works right through the system to the second and third bands, so that the standard rate will become payable after the first £400 of taxable income instead of £360, and by returning to this figure of £400 we are returning to the situation which obtained from the financial year 1952–53 up till the April, 1955 Budget.
Obviously, the reason for proposing this is to redistribute the tax concessions much more heavily in favour of the taxpayers with smaller incomes. I do not want to weary the Committee with examples. No doubt the Financial Secretary will have been furnished with a list of examples. I only wish that he had been furnished with such a list to show to the Chancellor before the Chancellor took his Budget decisions.
A married couple without children, on £600 a year—that is a fairly representative earning at the present time, though, of course, such a family is not representative in terms of absence of children—would gain about £5 13s. under the Chancellor's proposals for reduced rates, and that family would gain an additional £6 a year as a result of the Amendment which I am moving. It is clear that by this very small and simple change—indeed, by the restoration of something which the Lord Privy Seal upset in 1955 —in the case which I have mentioned, we have more than doubled the amount of tax relief which will be enjoyed under this present Budget. Anyone paying tax at the standard rate would get the maximum benefit under this Amendment of £12.
We recognise the difficulties which have been put forward by the Financial Secre

tary. We wish we had the amount of money to play with that the Chancellor has. It would have been possible to have done very many of the things proposed in these worth-while Amendments. We have made clear on a number of occasions that tax relief for companies and that sort of thing, even to the extent of the reduction in the standard rate, could have been far better and more fairly distributed among the population if the Chancellor had put through a number of reforms of the kind which we are moving this afternoon. This, however, is a very clear and simple one which would benefit millions of families and those whose needs are greatest. It is in that spirit that I move this Amendment.

Mr. Simon: The right hon. Member for Huyton (Mr. H. Wilson) has explained the purpose of this Amendment and, indeed, how it operates. I can give very briefly, in consonance with his own speech, and I hope equally cogently, the reasons why my right hon. Friend cannot accept this Amendment.
The first reason is that the Amendment gives no relief to those with the lowest taxable income. For example, it gives no relief to a married man with two children under 11 years of age living on earnings of less than £643 a year. The right hon. Gentleman gave an example, perfectly fairly, of a married couple without children having roughly the same average earnings, and he said that the benefit to them would be £6 a year. I think that shows the second disadvantage of this Amendment, namely, that it runs counter, as I understand it, to the argument of hon. Members opposite that the relief should be concentrated primarily on the married man with children; secondly, on the married man without children, and thirdly, on the single man. Indeed, my right hon. Friend was criticised in that the reduction in the standard rate that he has proposed and that the Committee has approved operates primarily or greatly to the advantage of the single man.

Mr. H. Wilson: Of course, this argument is fair and is true related purely to this one Amendment. But, as the hon. and learned Gentleman will be aware, we are moving a succession of Amendments which will take full account of the point he has in mind. The earned income relief example will affect all families. We also have proposals relating to the child allowance.

Mr. Simon: That is a perfectly fair point and it will have relevance when I come to consider the cost. It is right to point out that the argument which I have addressed applies solely to this Amendment, but, after all, it is to this Amendment that I am speaking at the moment.
The Amendment taken by itself gives no relief to those with the lowest taxable incomes. It concentrates the greatest relief on the single man, secondly on the married man without children, and thirdly —again applying purely to this Amendment—the reduction in tax would be smallest to those liable only at the reduced rate and greatest to those liable at the standard rate.
The right hon. Gentleman said that this was restoring the bands to where they stood in 1955. By itself, that is absolutely true. As he pointed out, my right hon. Friend the Lord Privy Seal did that as part of a larger operation whereby there were increases in the single and married personal allowances. The combined effect of those two things that he did was to raise the starting point of liability for tax, and to restrict the benefit in the main to those with the smallest incomes.
The fact remains that the reduced rate structure today is considerably more favourable than it was in 1951. In 1951 the band of taxable income chargeable at the lowest rate was only £50 in width—if I may follow the right hon. Gentleman into his metaphors—and was charged at 3s. in the £. Today it is £60 in width and will be charged only at ls. 9d. in the £. The next band was £200 and was charged at 5s. 6d. in the £. Today, the middle band is £150, charged at 4s. 3d. in the £. Then, in 1951, one went direct into the standard rate, whereas today there is a third reduced band of £150. I say a third without prejudice to the Amendment which we have just accepted from my hon. Friend the Member for Portsmouth, Langstone (Mr. Stevens). The third reduced band of £150 is charged at 6s. 3d. in the £.
In the end, this Amendment must be resisted on cost. By itself, it costs £124 million, and even taking that by itself, it would mean that the reductions which my right hen. Friend has proposed in the standard rate, and which have been accepted by the Committee, would have been limited to 3d. all round-3d. in the

standard rate, and 3d. in the reduced rates. As the right hon. Gentleman perfectly fairly points out, to be equitable, this must be read in the context of his other proposals, and it means that there would have been no reduction in the standard or reduced rates at all, if the right hon. Gentleman's way of dealing with the sum that was remissible in direct taxation was accepted.
Therefore, the Committee having accepted my right hon. Friend's proposals for reducing the standard rate, with its corollary that the reduced rates should also come down, it seems to me that the Committee is bound to reject this Amendment, and I so advise it.

Mr. Houghton: It is a very hard job to reconstruct the whole Bill and the Budget in the course of a series of Amendments like this, and we make no complaint when the Financial Secretary to the Treasury does exactly what I said the Committee should do—put this Amendment in the context of the whole series. Otherwise, separately, they would not fully achieve the purpose we have in mind.
What strikes me as being quite extraordinary about this Amendment is what happened in 1955. I have made a very careful search, and I find that the then Chancellor, now the Lord Privy Seal, put no figure to the step that he then took of reducing the lowest rate band from £100 to £60. There were figures given in the Financial Statement of the cost to the Exchequer of improved personal allowances and so on, but his references to this matter in his statement were most casual, and, so far as I can trace, there was never a cost put on it.
What the right hon. Gentleman did in 1955, at the time when he improved the personal allowances and reduced the standard rate, was to transfer from the lowest band at 2s. 3d. in the £ the amount of £40 of taxable income to the rate of 4s. 9d. in the £, which was quite an uplift of the rate of tax upon the £40 of taxable income falling between the £60—of the new limit to the lowest band—and the £100 which was the upper limit to the old band. It looks as if, almost by sleight-of-hand, the right hon. Gentleman in 1955 clawed back a very large proportion of the reliefs that he was giving in other directions.
We see little guidance on this in the Report of the Royal Commission, as on other matters. My hon. and learned Friend the Member for Kettering (Mr. Mitchison) was complaining a few moments ago that he did not understand the principles of income taxation, and suggested that probably there were not any. I think he is right; there are none, at least not many, and even the fundamental principle of assumed ability to pay can scarcely withstand examination today.
5.15 p.m.
The Royal Commission seemed to have no alternative bands of reduced rates to offer as being preferable to the ones which then existed, although it did link with the reduced rate bands the whole of the principle of graduation, exemption limits, personal allowances and so on. The Royal Commission did a very detailed exercise on the whole problem of how the graduated principle is applied, and there is no doubt that some distortions come into the scheme as a result of the steps taken, in times of stress, which probably had little justification, except on expediency, from a revenue point of view.
I very much regret that the hon. and learned Gentleman has felt moved to resist the Amendment. What is the formula he has on his paper? It is, "Presumed that the Amendment will be resisted." It is the sort of standing formula which is printed automatically at the foot of every page of foolscap which the Inland Revenue use for the purpose of briefing the hon. and learned Gentleman.

Mr. H. Wilson: Not on the last Amendment.

Mr. Houghton: There was no money in that, was there? That was probably dealt with in the Central Office of Information. That was a matter of the use of English, and the Inland Revenue would not know the answer to that one.
Certainly, on this matter, the Financial Secretary has been left in no doubt what he should do, and that is a pity. It means that I shall have to ask my hon. and right hon. Friends to support the Amendment in the Lobby. When the hon. and learned Gentleman says that it would be irresponsible to regard this set of Amendments as a feasible change in the Bill as it now stands, all I can say is that, as the wheels of the Committee grind slowly, the degree of irresponsibility will decline as time goes on, because the last Amendment will cost little or nothing, and he will not be able to say to us that the whole thing costs £200 million.
I warn the hon. and learned Gentleman that the time will come when we shall say "This is your last chance to show how reasonable you are." We have already dismissed one Amendment which the Financial Secretary said would cost about £6 million. Presumably, we are about to dismiss this one, and the grand total of cost is being reduced very rapidly. The point of reasonableness will soon be reached, and I hope that we shall secure a reasonable response from the hon. and learned Gentleman when he has an opportunity of moving in our direction without disastrous consequences to the financial structure of the Bill.

Question put, That those words be there inserted:—

The Committee divided: Ayes 194, Noes 240.

Division No. 108.]
AYES
[15.20 p.m.


Abse, Leo
Brockway, A. F.
Davies, Ernest (Enfield, E.)


Ainsley, J. W.
Broughton, Dr. A. D. D.
Davies, Stephen (Merthyr)


Albu, A. H.
Brown, Thomas (Ince)
Deer, G.


Allaun, Frank (Salford, E.)
Burke, W. A.
Delargy, H. J.


Allen, Arthur (Bosworth)
Burton, Miss F. E.
Diamond, John


Allen, Scholefield (Crewe)
Butler, Herbert (Hackney, C.)
Ede, Rt. Hon. J. C.


Awbery. S. S.
Butler, Mrs. Joyce (Wood Green)
Edwards, Rt. Hon. John (Brighouse)


Bacon, Miss Alice
Carmichael, J.
Edwards. Rt. Hon. Ness (Caerphilly)


Balfour, A.
Castle, Mrs. B. A.
Edwards, W. J. (Stepney)


Bence, C. R. (Dunbartonshire, E.)
Champion, A. J.
Evans, Albert (Islington, S.W.)


Benn, Hn. Wedgwood (Bristol, S.E.)
Chetwynd, G. R.
Fernyhough, E.


Benson, Sir George
Cliffe, Michael
Fletcher, Eric


Bevan, Rt. Hon. A. (Ebbw Vale)
Coldrick, W.
Forman, J. C.


Blackburn, F.
Collick, P. H. (Birkenhead)
Fraser, Thomas (Hamilton)


Blenkinsop, A.
Corbet, Mrs. Freda
Galtskell, Rt. Hon. H. T. N.


Blyton, W. R.
Cove, W. G.
Gibson, C. W.


Boardman, H.
Craddock, George (Bradford, S.)
Gooch, E. G.


Bottomley, Rt. Hon. A. G.
Cronin, J. D.
Gordon Walker, Rt. Hon. P. C.


Bowden, H. W. (Leicester, S.W.)
Grossman, R. H. S.
Greenwood, Anthony


Bowles, P. G.
Cullen, Mrs. A.
Grenfell, Rt. Hon. D. R.




Grey, C. F.
Mahon, Simon
Ross, William


Griffiths, David (Rother Valley)
Mann, Mrs. Jean
Royle, C.


Griffiths, Rt. Hon. James (Lianelly)
Marquand, Rt. Hon. H. A.
Shinwell, Rt. Hon. E.


Griffiths, William (Exchange)
Mason, Roy
Short, E. W.


Hale, Leslie
Mayhew, C. P.
Silverman, Julius (Aston)


Hall, Rt. Hn. Glenvil (Colne Valley)
Mitchison, G. R.
Silverman, Sydney (Nelson)


Hamilton, W. W.
Monslow, W.
Simmons, C. J. (Brierley Hill)


Hannan, W.
Moody, A. S.
Slater, J. (Sedgefieid)


Hastings, S.
Morris, Percy (Swansea, W.)
Snow, J W.


Hayman, F. H.
Mort, D. L.
Sorensen, R. W.


Henderson, Rt. Hn. A. (Rwly Regis)
Moss, R.
Soskice, Rt. Hon. Sir Frank


Herbison, Miss M.
Moyle, A.
Sparks, J. A.


Hewitson, Capt. M.
Mulley, F. W.
Spriggs, Leslie


Hobson, C. R. (Keighley)
Neal, Harold (Bolsover)
Stewart, Michael (Fulham)


Holman, P.
Noel-Baker, Francis (Swindon)
Stones, W. (Consett)


Holmes, Horace
Noel-Baker, Rt. Hon. P. (Derby, S.)
Strauss, Rt. Hon. George (Vauxhall)


Houghton, Douglas
Oliver, G. H.
Summerskill, Rt. Hon. E.


Hughes, Cledwyn (Anglesey)
Oram, A. E.
Sylvester, G. 0.


Hughes, Emrys (S. Ayrshire)
Orbach, M.
Taylor, Bernard (Mansfield)


Hughes, Hector (Aberdeen, N.)
Oswald, T.
Thomas, lorwerth (Rhondda, W.)


Hunter, A. E.
Owen, W. J.
Thomson, George (Dundee, E.)


Hynd, H. (Accrington)
Padiey, W. E.
Thornton, E.


Hynd, J. B. (Attercliffe)
Palmer, A. M. F.
Tomney, F.


Irvine, A. J. (Edge Hill)
Parker, J.
Vlant, S. P.


Irving, Sydney (Dartford)
Parkin, B. T.
Warbey, W. N.


Isaacs, Rt. Hon. G. A.
Paton, John
Watkins, T. E.


Janner, B.
Pearson, A.
Weitzman, D.


Jay, Rt. Hon. D. P. T.
Peart, T. F.
Wells, Percy (Faversham)


Jeger, George (Goole)
Pentland, N.
Wells, William (Walsall, N.)


Jeger, Mrs. Lena(Hlbn &amp; St. Pncs, S.)
Plummer, Sir Leslie
Wheeldon, W. E.


Jones, Rt. Hon. A. Creech(Wakefield)
Popplewell, E.
White, Henry (Derbyshire, N.E.)


Jones, Jack (Rotherham)
Prentice, R. E.
Wilkins, W. A.


Jones, J. Idwal (Wrexham)
Price, J. T. (Westhoughton)
Willey, Frederick


Kenyon, C.
Price, Philips (Gloucestershire, W.)
Williams, Rev. Llywelyn (Ab'tillery)


Key, Rt. Hon. C. W.
Probert, A. R.
Williams, Rt. Hon. T. (Don Valley)


King, Dr. H. M.
Pursey, Cmdr. H.
Willis, Eustace (Edinburgh, E.)


Lawson, G. M.
Rankin, John
Wilson, Rt. Hon. Harold (Huyton)


Lee, Frederick (Newton)
Redhead, E. C.
Winterbottom, Richard


Lee, Miss Jennie (Cannock)
Reeves, J.
Woodburn, Rt. Hon. A.


Lewis, Arthur
Reid, William
Woof, R. E.


Lipton, Marcus
Reynolds, G. W.
Yates, V. (Ladywood)


Mahon, Dr. J. Dickson
Rhodes, H.
Zilliacus, K.


McAlister, Mrs. Mary
Robens, Rt. Hon. A.



McInnes, J.
Roberts, Albert (Normanton)
TELLERS FOR THE AYES:


McKay, John (Wallsend)
Roberts, Goronwy (Caernarvon)
Mr. John Taylor and Mr. Rogers.


McLeavy, Frank
Robinson, Kenneth (St. Pancras, N.)



MacPherson, Malcolm (Stirling)






NOES


Agnew, Sir Peter
Butler, Rt. Hn.R.A.(Saffron Walden)
George, J, C. (Pollok)


Aitken, W. T.
Campbell, Sir David
Glover, D.


Allan, R. A. (Paddington, S.)
Carr, Robert
Glyn, Col. Richard H.


Amery, Julian (Preston, N.)
Cary, Sir Robert
Godber, J. B.


Amory, Rt. Hn. Heathcoat (Tiverton)
Channon, H. P. G.
Goodhart, Philip


Anstruther-Cray, Major Sir William
Chichester-Clark, R.
Gough, C. F. H.


Arbuthnot, John
Cole, Norman
Gower, H. R.


Armstrong, C. W.
Conant, Maj. Sir Roger
Graham, Sir Fergus


Ashton, H.
Cooke, Robert
Grant, Rt. Hon. W. (Woodside)


Atkins, H. E.
Cordeaux, Lt.-Col. J. K.
Grant-Ferris, Wg Cdr. R. (Nantwich)


Baldock, Lt.-Cmdr. J. M.
Corfield, F. V.
Green, A.


Baldwin, Sir Archer
Craddock, Beresford (Spelthorne)
Gresham Cooke, R.


Barber, Anthony
Crowder, Sir John (Flnchley)
Grimond, J.


Barlow, Sir John
Crowder, Petre (Ruislip—Northwood)
Grimston, Hon. John (St. Albans)


Barter, John
Cunningham, Knox
Grosvenor, Lt.-Col. R. G.


Batsford, Brian
Currie, G. B. H.
Gurden, Harold


Baxter, Sir Beverley
Dance, J. C. G.
Hall, John (Wycombe)


Beamish, Col. Tufton
Davidson, Viscountess
Hare, Rt. Hon. J. H.


Bell, Philip (Bolton, E.)
Davies, Rt. Hn. Clement(Montgomery)
Harris, Reader (Heston)


Bell, Ronald (Bucks, S.)
D'Avigdor-Goldsmid, Sir Henry
Harrison, A. B. C. (Malden)


Bevins, J. R. (Toxteth)
de Ferranti, Basil
Harrison, Col. J. H. (Eye)


Biggs-Davison, J. A.
Dodds-Parker, A. D.
Harvey, John (Walthamstow, E.)


Bingham, R. M.
Doughty, C. J. A.
Heald, Rt. Hon. Sir Lionel


Birch, Rt. Hon. Nigel
du Cann, E. D. L.
Heath, Rt. Hon. E. R. G.


Bishop, F. P.
Duncan, Sir James
Henderson, John (Cathcart)


Black, Sir Cyril
Eden, J. B. (Bournemouth, West)
Henderson-Stewart, Sir James


Body, R. F.
Emmet, Hon. Mrs. Evelyn
Hicks Beach, Maj. W. W.


Bonham Carter, Mark
Errington, Sir Eric
Hill, Mrs. E. (Wythenshawe)


Bowen, E. R. (Cardigan)
Erroll, F. J.
Hill, John (S. Norfolk)


Boyd-Carpenter, Rt. Hon. J. A.
Farey-Jones, F. W.
Hinchingbrooke, Viscount


Boyle, Sir Edward
Fell, A.
Hirst, Geoffrey


Braine, B. R.
Fisher, Nigel
Holland-Martin, G. J.


Brewis, John
Fletcher-Cooke, C.
Holt, A. F.


Brooman-White, R. C.
Fort, R.
Hornby, R. P.


Browne, J. Nixon (Cralgton)
Freeth, Denzil
Horobin, Sir Ian


Bryan, P.
Galbraith, Hon. T. G. D.
Horshrugh, Rt. Hon. Dame Florence


Burden, F. F. A.
Gammans, Lady








Howard, John (Test)
Maydon, Lt.-Comdr. S. L. C.
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Hughes Hallett, Vice-Admiral J.
Medlicott, Sir Frank
Stanley, Capt. Hon. Richard


Hughes-Young, M. H. C.
Milligan, Rt. Hon. W. R.
Stevens, Geoffrey


Hurd, Sir Anthony
Molson, Rt. Hon. Hugh
Steward, Harold (Stockport, S.)


Hutchison, MichaelClark(E'b'gh, S.)
Morrison, John (Salisbury)
Steward, Sir William (Woolwich, W.)


Hylton-Foster, Rt. Hon. Sir Harry
Mott-Radclyffe, Sir Charles
Stoddart-Scott, Col. Sir Malcolm


Iremonger, T. L.
Nairn, D. L. S.
Storey, S.


Jenkins, Robert (Dulwich)
Neave, Airey
Stuart, Rt. Hon. James (Moray)


Jennings, Sir Roland (Hallam)
Nicholls, Harmar
Studholme, Sir Henry


Johnson, Eric (Blackleg)
Nicholson, Sir Godfrey (Farnham)
Summers, Sir Spencer


Joseph, Sir Keith
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Taylor, Sir Charles (Eastbourne)


Keegan, D.
Noble, Michael (Argyll)
Taylor, William (Bradford, N.)


Kerby, Capt. H. B.
Nugent, Richard
Teeling, W.


Kerr, Sir Hamilton
Oakshott, H. D.
Temple, John M.


Kirk, P. M.
Ormsby-Gore, Rt. Hon. W. D.
Thomas, Leslie (Canterbury)


Lambton, Viscount
Orr-Ewing, C. Ian (Hendon, N.)
Thorneycroft, Rt. Hon. P.


Lancaster, Col. C. G.
Osborne, C.
Thornton-Kemsley, Sir Colin


Langford-Holt, J. A.
Page, R. G.
Turner, H. F. L.


Leavey, J. A.
Pannell, N. A. (Kirkdale)
Turton, Rt. Hon. R. H.


Leburn, W. G.
Partridge, E.
Tweedsmuir, Lady


Legge-Bourke, Maj. E. A. H.
Peel, W. J.
Vane, W. M. F.


Legh, Hon. Peter (Petersfield)
Peyton, J. W. W.
Vaughan-Morgan, J. K.


Lindsay Hon. James (Devon, N.)
Pickthorn, Sir Kenneth
Vickers, Miss Joan


Lindsay, Martin (Solihull)
Pike, Miss Mervyn
Vosper, Rt. Hon. D. F.


Linstead, Sir H. N.
Pilkington, Capt. R. A.
Wade, D. W.


Lloyd, Maj. Sir Guy (Renfrew, E.)
Pitman, I. J.
Wakefield, Edward (Derbyshire, W.)


Longden, Gilbert
Pott, H. P.
Wakefield, Sir Wavell (St. M'lebone)


Loveys, Walter H.
Powell, J. Enoch
Walker-Smith, Rt. Hon. Derek


Low, Rt. Hon. Slr Toby
Price, David (Eastleigh)
Wall, Patrick


Lucas, Sir Jocelyn (Portsmouth, S.)
Prior-Palmer, Brig. 0. L.
Ward, Rt. Hon. G. R. (Worcester)


Lucas-Tooth, Sir Hugh
Ramsden, J. E.
Ward, Dame Irene (Tynemouth)


Macdonald, Sir Peter
Rawlinson, Peter
Watkinson, Rt. Hon. Harold


McLaughlin, Mrs. P.
Redmayne, M.
Webbe, Sir H.


Maclean, Sir Fitzroy (Lancaster)
Rees-Davies, W. R.
Webster, David


Macleod, Rt. Hn. lain (Enfield, W.)
Remnant, Hon. P.
Williams, Paul (Sunderland, S.)


McMaster, S. R.
Renton, D. L. M.
Wills, Sir Gerald (Bridgwater)


Macmillan, Rt. Hn. Harold (Bromley)
Ridsdale, J. E.
Wilson, Geoffrey (Truro)


Maitland, Cdr. J. F. W. (Horncastle)
Robinson, Sir Roland (Blackpool, S.)
Wood, Hon. R.


Maitland, Hon. Patrick (Lanark)
Roper, Sir Harold
Woollam, John Victor


Markham, Major Sir Frank
Ropner, Col. Sir Leonard
Yates, William (The Wrekin)


Marlowe, A. A. H.
Russell, R. S.



Marples, Rt. Hon. A. E.
Sharpies, R. C.
TELLERS FOR THE NOES:


Marshall, Douglas
Simon, J. E. S. (Middlesbrough, W.)
Mr. Finlay and Mr. Whitelaw.


Mathew, R.
Spearman, Sir Alexander



Mawby, R. L.
Spelr, R. M.

Mr. Houghton: I beg to move, in page 14, line 23, at the end, to insert:
(3) Subsection (1) (earned income relief) of section two hundred and eleven of the Income Tax Act, 1952, shall have effect as if after the words "standard rate on" there were inserted the words "one quarter of the claimant's earned income, if that income does not exceed one thousand pounds, or, if that income exceeds one thousand pounds but does not exceed one thousand one hundred and twenty-five pounds, on two hundred and fifty pounds, or, if that income amounts to or exceeds one thousand, one hundred and twenty-five pounds. on".
This Amendment proposes a change in the earned income relief. The Committee will remember that, prior to 1957, earned income relief was a deduction of two-ninths from income with a maximum of £450. From 1957 onwards, the limit of earned income qualifying for the two-ninths relief was raised to £4,005 and a new and reduced earned income relief of one-ninth was given to income beyond £4,005, so that from 1957 onwards the earned income relief of two-ninths on the first £4,005 and one-ninth on the next £5,940 increased the total earned income relief from £450 to £1,550.
In 1957, we on this side of the Committee said that that was going too far. It certainly went further than the Royal Commission recommended. However, that is how it was and that is how it is. Now we propose to bring in a new and more favourable relief of one-quarter instead of two-ninths for earned incomes which do not exceed £1,000 a year, but we make provision in the Amendment for marginal adjustments for incomes which do not exceed £1,125.
5.30 p.m.
I want to make it clear that this relief stands by itself as an alternative to the older earned income relief. A person can have one or the other, but not both. The Committee will appreciate that this is an attempt to give a more favourable earned income relief to those with lower incomes. We strike the same note in this Amendment, as we did in the two previous Amendments and shall do in subsequent Amendments, of giving more relief than the Bill provides to those on smaller incomes and to whom the personal reliefs matter most. The maximum benefit which


any taxpayer could obtain under the Amendment would be an increase in earned income relief of £27—from £223 to £250. In terms of the new standard rate of tax, the tax saving would be £10 9s. 3d. That is the most that anyone would get out of it.
To give an example, as a result of our proposal the tax saving to a married man with an income of £700, and with one child under 11 years of age, would be £4 Os. 9d.—a very modest saving, it must be admitted. He will already have gained under the Bill a tax reduction of £6 a year, so that if the Chancellor's proposals are added to our proposal a married man with £700 and with one child under 11 would gain a tax relief of £10 instead of £6. You will note, Sir Robert, in what modest terms we are speaking.
I know that the modesty of the benefit which individuals would receive is not an index to the ultimate cost because of the large numbers involved. I am keeping a shopping list, and I think that at the moment the Financial Secretary, by his skill and persuasion in argument, has persuaded the Committee to reject £130 million worth of desirable improvements to the Bill.

Mr. A. J. Champion: He did it by his majorities in the Lobby.

Mr. Houghton: Yes, but I hope that we shall not mix up majorities in Committee with the millions of £s involved in these proposals.
The danger to the financial stability of the Bill is growing less as time goes by. I confess that I do not know what our proposal would cost, but I have no doubt that the Financial Secretary will be able to tell us. When dealing with the previous Amendment a few moments ago, the Financial Secretary repeated the converse of the customary argument of himself and his right hon. Friend in these matters. He said that the proposal would give the least benefit to those who pay the least amount of tax. His argument usually is that we cannot help giving the most relief to those who pay the most tax and that we just have to accept the arithmetic and not import any arguments of social justice, of fiscal equity or anything else which has to do with the morality or desirability of the situation.
The hon. Member for Wokingham (Mr. Remnant) was absent a little while ago when I was relying heavily on his support for an Amendment to improve the housekeeper relief. I had in front of me a good mark for his behaviour in 1951, when he tabled an Amendment, in company with other of his hon. Friends, to improve the housekeeper relief. Now he is in some way impeding me in trying to persuade the Committee to accept the Amendment.

Mr. Peter Remnant: I must apologise for my reference to the Inland Revenue merely accepting figures as they stand without introducing other elements.

Mr. Houghton: The apology is accepted.
Here we are trying to give more relief than the Bill provides to those on the smaller and what one might call middle incomes. Hon. Members opposite profess a great interest in the problems of the middle income groups—those who are managers and supervisors and those who occupy positions of responsibility, very frequently for modest rewards. They are not in business on their own. They have not all the benefits of the relaxed expenses rule under Schedule D. They are tightly held by the Inland Revenue by the words "wholly, exclusively and necessarily incurred in the performance of their office". They have no room to move except by the connivance of their employers, or something of that sort. These people are held in the grip of the Income Tax machine and have no reliefs except those which the Bill and the Income Tax Acts provide.
We are not afraid of asking hon. Members opposite to extend their sympathetic interest to these people. It is true that the man with an earned income of £1,000 a year, which is a modest but not large income today, would get the maximum benefit from the Amendment. A person with an income of £500 a year would not. I simply cannot help that. One cannot do everything one would like in the proportions that one would wish when dealing with the mathematics of a progressive system of taxation, but it is a step in the right direction. I hope that the hon. and learned Gentleman will give it sympathetic attention.
I am becoming increasingly conscious of the problem in moving Amendments,


namely, that as we erect them in a group and confront the Committee with them, the hon. and learned Gentleman merely bowls them over, rather like ninepins, one after the other. The pattern of our proposals becomes less coherent and less convincing as the Amendments are destroyed one by one. However, as the Chancellor said to me in another context once. "I must soldier on", and that is what I am doing. If the Committee will look at this Amendment, in relation to the other Amendments, on its merits, I think that it will see that it is deserving of support.
In conclusion, I would remind the Committee that the Lord Privy Seal, when Chancellor of the Exchequer, said in a debate on a Finance Bill that he was looking forward to the time—I am not quoting him literally, but this is the gist of what he said—when he would be able to improve the earned income relief to one-quarter. I distinctly remember that, although I have not been able to put my hand on the reference. He was hoping to improve the earned income relief to one-quarter. To make it one-quarter to £4,005 and one-eighth instead of one-ninth from £4,005 to £9,945 would be going further than we would wish to go. We are trying to make a beginning on the one-quarter earned income relief on earned incomes which in total do not exceed £1.000.

Mr. Eric Fletcher: I wish to support the Amendment moved by my hon. Friend the Member for Sowerby (Mr. Houghton) in, if I may say so, so persuasive a manner. I think that he can congratulate himself on the fact that he is soldiering on with very great determination and efficiency, and on this occasion, I hope, with success.
We have still not been granted any concessions in this Finance Bill, and I hope that as on previous occasions the Chancellor and his able deputies are saving something up their sleeves as a concession which they will be able to give to the Committee in the course of this stage of the Bill. After all, this is a year in which without precedent the Chancellor has had a larger sum of money to give away in tax reliefs than ever before, and, stickler as he is for precedents —so we gathered yesterday—I hope that on this Finance Bill he will follow the precedents that have been observed in

nearly every other Finance Bill by making at least some concession to the Opposition during the Committee stage. I can think of nothing more deserving than that for which the Amendment asks. The cost would not be very considerable. I think that, if anything, my hon. Friend almost exaggerated the modesty of the Amendment.
May I briefly try to restate in my own words the arguments which I hope will influence the Treasury to accept the Amendment? I believe that it has long been recognised that there ought to be a distinction in tax liability between earned income and unearned income. The Royal Commission emphatically recommended that the differential between the tax on earned income and the tax on unearned income should be widened.
We have held for a long time that the existing differential, namely, two-ninths up to a certain figure and one-ninth beyond that figure, is inadequate. We think that it is in the interest of the objective of encouraging enterprise and industry that there should be some real attractiveness in earned income as distinct from unearned income which could best be observed by way of an appropriate tax relief. We do not think it would be right that the same figure should be constant throughout the whole range of unearned income. That principle is now conceded.
We are particularly concerned with the relatively small incomes of those earning up to £1,000 a year. These are people who, for the most part, marry and have families and for whom every shilling and every penny counts in their household budget.
My hon. Friend said that if this tax concession were granted, the maximum relief which any individual would receive from it would be £10 9s. 3d. in tax liability. In most cases, of course, it would be rather less than that, but whether it is £4, £5 or £6, it is something which would make a difference to those people. We think that it would be meritorious because the relief would go only to those with earned incomes and not to those with unearned incomes. We believe that these people constitute a section of the community which, I would hope, both sides of the Committee would wish to encourage.
5.45 p.m.
As the Committee knows, one of our major criticisms of this Budget and this Finance Bill is that the Chancellor, having decided to reduce the standard rate of tax, necessarily had to confer tax reliefs on all taxpayers regardless of the size of their incomes. In so doing, the right hon. Gentleman failed, in our view, to give what is far more necessary at the present time, a correspondingly greater tax relief to those with small or relatively small incomes. We believe that the Chancellor would have been much better advised had he conferred some of his relief from taxation by extending the allowances and reliefs to which this series of Amendments relates. The first two Amendments, of course, have been disposed of.
I hope that the Government will accept the Amendment on the ground that it will increase enterprise, will promote social justice, will be in accordance with the recommendations of the Royal Commission and will give assistance where it is badly needed.

Mr. John McKay: I sometimes think that it is useless to try to get any Amendment on these matters accepted by the Government. The greater one's experience in the House of Commons the more it tends on most occasions to indicate that fact. There is a kind of psychology about Finance Bills and Income Tax, a psychology with which I do not agree. It is that the Income Tax machine is so complicated that one cannot differentiate sufficiently to be able to help the lower income groups without helping the higher income groups. This Amendment indicates that that is not correct.
If we are willing and anxious to help the lower income groups there is nothing at all in the Finance Bill, or in practice, which prevents us from doing so. I do not know why the Amendment has fixed the figure at £1,000. It is an indication that we can use our arithmetic and our Amendments to the Finance Bill in such a way that we can, if we wish, give something to a particular section of the community. I always regard the average wage earner as the person earning £7, £8, £9, £10, £11 or £12 a week.
Had the Amendment fixed on the sum of £500 a year instead of £1,000 a year

we could, perhaps, have amended one-quarter to one-third and made it apply more definitely to the much poorer section of the community. The Amendment is a very small attempt on the part of the Labour Party to see whether Parliament is really an instrument whereby we can get a greater degree of justice in this matter so that more groups of the community can really be helped.
The Amendment asks so little, but, of course, the Government will not accept it. In fact, I would wonder what had come over the Government if they agreed to even the slightest amendment of the Income Tax provisions that would benefit the lower section of taxpayers. If that did happen, we would look on in wonderment. It would be such an unexpected thing that we would be watching the newspapers to see what the Press had to say about it.
On the other hand, the Government should be open to persuasion, and it is true that sometimes they are prepared to take account of what is said and to change their minds. I notice that the Government went out of their way to help one section of the community, the only proviso being that those benefiting should be 65 years of age or over. A year or two ago the Government legislated for that class by enacting that in respect of the investment income of a married couple, one of whom was 65 or over, the first £440 should be absolutely exempt from Income Tax.
That is investment income, yet the poor worker in the factory, in the pit or on the farm has to slave all the year round to earn that much, and from it has to meet travelling expenses, insurance premiums and the rest. In addition, it must be remembered that an investment income of £440 a year can come only from several thousands—more likely running into the twenties of thousands—of capital.
The Amendment asks for very little. Indeed, it asks for so little that it is questionable whether it was worth putting on the Notice Paper, but we have learned from experience that there is never any chance of the Government accepting, or even considering, an Amendment that contains a really worth-while benefit. On this occasion, the Opposition have asked for the very least, and suggest that here there is cause for some improvement.
I have no idea what the cost would be, but the scope of the Amendment is tremendously limited when compared with the earlier Amendments we have discussed today. I must admit that I was surprised to hear how much one of the earlier Amendments would have cost. What would this Amendment cost? Would it be such an amount that the Government really could not consider it? If it does not involve a very big sum, let the Government give the poor Opposition the credit for once of being able to say, "Look what we have done. We have improved the situation."

Viscount Hinchingbrooke: I hope that the Government will not accept this Amendment. I was very glad that there was not any reference to such a concession in the Budget. My right hon. Friend the Member for Monmouth (Mr. P. Thorneycroft) went very far in this direction in his Budget of 1957–58—beyond, I think, the terms recommended by the Royal Commission in its second Report.
We have advanced very far on these lines—so far, it seems to me, that we are almost in danger of discriminating adversely against saved or invested income. If we make the earned income relief very substantial, the moment the person had earned money and invested it, it would become saved income and be subject to a higher tax rate. The knowledge that that would happen would be a disincentive to saving. We have gone as far as we can possibly go here, and I hope that the Government will not concede the Amendment.

The Economic Secretary to the Treasury (Mr. F. J. Erroll): The hon. Member for Sowerby (Mr. Houghton) spoke of the Government knocking down the Opposition's Amendments one by one as though they were ninepins, and my hon. and learned Friend thought that it might make an agreeable change if I were to have a turn in this particular bowling-alley—although I admit at once that I have nothing like his experience.
First, I should like to elicit an item of explanation from the hon. Member. I am not quite clear whether this Amendment is part of the Opposition's plan for what might be described as an alternative Finance Bill, presented in a series of Amendments, or whether it was a

modest attempt to reverse the arrangements for earned income allowances introduced in the 1957 Budget.
In what the hon. Gentleman said I thought that I detected a kind of unwilling acceptance of the major changes then introduced. I got the impression that he would rather not have seen the earned income reliefs given up to £4,005, and then an allowance of one-ninth up to £9,000-odd, and that this was the time to reverse the reliefs in favour of the small incomes—

Mr. Houghton: I referred to the events of 1957, first, to explain what happened then, and, secondly, to recall that we on this side of the Committee thought that the then Chancellor, the right hon. Member for Monmouth (Mr. P. Thorneycroft) had gone too far. Nevertheless, I thought that I had made it very plain that we accepted that earned income relief structure, and were not proposing to change it in any way. All the benefits then given are retained in full by our proposal.
What this Amendment proposes to do is to build into the structure of earned income relief a special concession of one-quarter instead of two-ninths of earned incomes not exceeding £1,000 a year. Therefore, those with the large earned income relief would keep it. This benefit would go only to the smaller incomes.

Mr. Erroll: I am grateful to the hon. Gentleman for that explanation. This Amendment, therefore, would give an additional relief to the smaller man earning up to £1,000, with marginal relief up to £1,125.
The real point at issue is whether this should be our Budget or the Opposition's Budget. My right hon. Friend has decided to introduce his Budget in the particular form and in the particular structure he has deemed to be best. Therefore, I really cannot shed many tears over the plea of the hon. Gentleman when he complains that this Opposition grand plan, interesting and well worth study as it may be, is being disposed of point by point as we knock each of their Amendments off its feet—with, so far, very telling arguments, and I hope that the arguments on this occasion will be as telling at the conclusion of the debate.
6.0 p.m.
What we have to appreciate is that the present scale of earned income allowances so generously distinguishes between the taxable capacity of earned and of investment income that there is already a substantial differential, and it would not be wise to carry that differential any further. Earned income is still much more favourably treated than unearned income, which is a matter which the Committee would do well to remember.
The hon. Gentleman the Member for Sowerby referred to a figure of £1,000 in giving his examples, and I will use the same figure. A childless married man with an earned income of £1,000 per annum will pay this year £152 in tax, if all the income is earned, but if it is income solely derived from investments he will pay no less than £239 in tax. So that there is still a substantial relief in favour of the earned income, which is quite proper and as it should be, but it has to be remembered that we should not carry the differential too far; and I was glad to have the support of my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) in this matter.
The importance, in our view, of not making the discrimination too severe is, we feel, that, while earning money is important, saving and investing is also important. Hon. Gentlemen opposite have frequently said that what they would wish to see is a greater degree of investment and a higher level of personal savings. People are prepared to save and invest only if they are to get some reward for doing so; in other words, if they are to derive an income from saving or investment. That being so it is only reasonable that that reward, called, perhaps by reason of historic accident, unearned income, should not be so heavily taxed as to make it not worth while to save or to invest.
I think that everyone who saves or invests realises that the tax borne on unearned income should be higher than that borne on earned income, but not so high as to make it a powerful deterrent to further saving and investment. I hope that what I have said will serve as an explanation in reply to the remarks made by the hon. Gentleman the Member for Islington, East (Mr. E. Fletcher).
The hon. Gentleman the Member for Wallsend (Mr. McKay) spoke of this

Amendment as though it were a small one which could easily be accepted because the cost involved in so doing would be negligible. I am sorry to have to tell the Committee that quite apart from any other arguments in favour of rejecting this Amendment it would have to be rejected by the Committee, in my view, on the ground of the very high cost. It would cost no less than £72 million in a full year. Therefore, to accept this Amendment would be substantially to alter the structure of my right hon. Friend's Budget and to introduce an altogether different element into it.
I am sorry to have to knock down yet another of the Opposition's ninepins, but I hope that the Committee will agree with me that I am right in asking it to do so this time.

Mr. Houghton: The hon. Gentleman the Economic Secretary, of course, made an agreeable change from his hon. and learned Friend the Financial Secretary. [HON. MEMBERS: "0h."] I knew I was expressing myself badly as the words came out. I did not mean that at all. What I mean to say is that they are equally welcome contributors to our deliberations. Unfortunately, I must inflict myself on the Committee again, because my right hon. Friend the Member for Smethwick (Mr. Gordon Walker) has been called away and I am left somewhat alone on this Amendment.

Mr. H. Wilson: Not altogether alone.

Mr. Houghton: My right hon. Friend the Member for Huyton (Mr. H. Wilson) would enter the debate with his usual zest and skill, but he did not hear the earlier argument fully deployed, though, of course, he is in full support of the Amendment.

Mr. Wilson: Hear, hear.

Mr. Houghton: His presence here now is evidence of that.
The Economic Secretary cannot tell any of us who have been in the Committee upstairs on the National Insurance Bill anything about trying to alter a Government Bill into our Bill. We had more than 20 meetings of that Committee without, on our side, having altered the Bill by a single letter or comma, which


was a very frustrating experience beside which this is quite a mild one.
I realise that we have several times tried to put into the right hon. Gentleman's Budget what is not there, and into the Bill that which is deliberately left out of his proposals, but that really does not detract from the value of discussing what we think are the deficiencies of the Bill in this respect, and we are still not without hope that before long we may propose something which so appeals to right hon. and hon. Gentlemen opposite as being reasonable, even within the context of this Bill, that we may get them to accept it.
It may be that the right hon. Gentleman the Member for Monmouth (Mr. P. Thorneycroft), by going too far in 1957, will prevent us from going far enough in 1959. That is another problem we are up against, not only on this Bill, for we have been up against it in considering previous Measures. In 1957, £24½ million in a full year were conceded in the additional earned income relief, and no part of any of the £24½ million went to any person earning less than £2,005 a year. Not only did the two-ninths go up to a limit of income of £4,005, as against the recommendation of the Royal Commission on the Taxation of Profits and Income that it should go to £2,500, but the right hon. Gentleman carried the reduced one-ninth relief much further than the Royal Commission recommended.
The Royal Commission suggested that the one-ninth relief should be on incomes between £2,500 and £3,000. The right hon. Gentleman the Member for Monmouth gave the one-ninth relief on incomes between £4,005 and nearly £10,000 a year. The small incomes which we are now proposing to benefit through a one-fourth earned income relief are having

to pay for the bounty given in the higher ranges of earned income in 1957.

The noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) made a plea for fair treatment of income from savings. None of us on this side of the Committee wishes to injure in any way the rewards for genuine savings, for the money which people put aside out of their earnings and save for themselves or their families. The Amendment would facilitate savings in a range of incomes where it is most difficult to save today. It would reduce the tax burden which those small incomes bear and release a very modest amount of additional money for savings. The Amendment does nothing to penalise the income from savings in any way whatsoever.

We on this side have on the Notice Paper for consideration later a new Clause to extend the scope of tax relief on small savings beyond the amounts in the Post Office Savings Bank and Trustee Savings Banks. This indicates that we are trying to spread the reliefs not only to small un-earned incomes, but to small unearned incomes from certain sources.

The Chancellor does not like the expression that he has "given away". I have no wish to offend him, but we are confronted with the difficulty that the right hon. Gentleman has given tax remissions in Clause 14 amounting in a full year to £229 million. It is against that background that this small additional benefit to the lower incomes is being proposed. Once more, I can only urge my right hon. and hon. Friends to press this matter to a Division, in view of the unsatisfactory response that we have had from the new batsman on the Front Bench opposite.

Question put, That those words be there inserted:—

The Committee divided: Ayes 188, Noes 227.

Division No. 109.]
AYES
[6.12 p.m.


Ainsley, J. W.
Boardman, H.
Chapman, W. D.


Albu, A. H.
Bottomley, Rt. Hon. A. G.
Chetwynd, G. R.


Allaun, Frank (Salford, E.)
Bowden, H. W. (Leicester, S.W.)
Cliffe, Michael


Allen, Arthur (Bosworth)
Bowles, F. G.
Coldrick, W.


Allen, Scholefield (Crewe)
Brockway, A. F.
Collick, P. H. (Birkenhead)


Awbery, S. S.
Broughton, Dr. A. D. D.
Corbet, Mrs. Freda


Bacon, Miss Alice
Brown, Rt. Hon. George (Belper)
Craddock, George (Bradford, S.)


Bence, C. R. (Dunbartonshire, E.)
Brown, Thomas (Ince)
Cronin, J. D.


Benn, Hn. Wedgwood (Bristol, S.E.)
Burke, W. A.
Crossman, R. H. S.


Benson, Sir George
Burton, Miss F. E.
Davies, Ernest (Enfield, E.)


Bevan, Rt. Hon. A. (Ebbw Vale)
Butler, Herbert (Hackney, C.)
Delargy, H. J.


Blackburn, F.
Butler, Mrs. Joyce (Wood Green)
Diamond, John


Blenkinsop, A.
Carmichael, J.
Ede, Rt. Hon. J. C.


Blyton, W. R.
Champion, A. J.
Edelman, M.




Edwards, Rt. Hon. John (Brighouse)
Lee, Miss Jennie (Cannock)
RObens, Rt. Hon. A.


Edwards, Rt. Hon. Ness (Caerphilly)
Lindgren, G. S.
Roberts, Albert (Normanton)


Edwards, W. J. (Stepney)
Lipton, Marcus
Roberts, Goronwy (Caernarvon)


Evans, Albert (Islington, S.W.)
Mabon, Dr. J. Dickson
Robinson, Kenneth (St. Pancras, N.)


Fernyhough, E.
McAlister, Mrs. Mary
Rogers, George (Kensington, N.)


Fletcher, Eric
McInnes, J.
Ross, William


Forman, J. C.
McKay, John (Wallsend)
Royle, C.


Fraser, Thomas (Hamilton)
McLeavy, Frank
Shinwell, Rt. Hon. E.


Gaitskell, Rt. Hon. H. T. N.
MacPherson, Malcolm (Stirling)
Short, E. W.


Gibson, C. W.
Mahon, Simon
Silverman, Julius (Aston)


Gooch, E. G.
Mann, Mrs Jean
Silverman, Sydney (Nelson)


Greenwood, Anthony
Marquand, Rt. Hon. H. A,
Simmons, C. J. (Brierley Hill)


Grenfell, Rt. Hon. D. R.
Mason, Roy
Slater, J. (Sedgefield)


Grey, C. F.
Mayhew, C. P.
Smith, Ellis (Stoke, S.)


Griffiths, David (Rother Valley)
Mitchison, G. R.
Snow, J. W.


Griffiths, Rt. Hon. James (Llanelly)
Monslow, W.
Sorensen, R. W.


Griffiths, William (Exchange)
Moody, A. S.
Soskice, Rt. Hon. Sir Frank


Hale, Leslie
Morris, Percy (Swansea, W.)
Spriggs, Leslie


Hall, Rt. Hn. Glenvil (Coins Valley)
Mort, D. L.
Stones, W. (Consett)


Hamilton, W. W.
Moss, R.
Strauss, Rt. Hon. George (Vauxhall)


Hannan, W.
Moyle, A.
Summerskill, Rt. Hon. E.


Hastings, S.
Mulley, F. W.
Sylvester. G. 0.


Hayman, F. H.
Neal, Harold (Bolsover)
Taylor, Bernard (Mansfield)


Healey, Denis
Noel-Baker, Rt, Hon. P. (Derby, S.)
Taylor, John (West Lothian)


Henderson, Rt. Hn. A. (Rwly Regis)
Oliver, G. H.
Thomas, Lorwerth (Rhondda, W.)


Herbison, Miss M.
Oram, A. E.
Thomson, George (Dundee, E.)


Hewitson, Capt. M.
Orbach, M.
Thornton, E.


Hobson, C. R. (Keighley)
Oswald, T.
Tomney, F.


Holman, P.
Owen, W J.
Viant, S. P.


Houghton, Douglas
Padley, W. E.
Warbey, W. N.


Hughes, Cledwyn (Anglesey)
Palmer, A. M. F.
Watkins, T. E.


Hughes, Emrys (S. Ayrshire)
Parker, J.
Weitzman, D.


Hughes, Hector (Aberdeen, N.)
Parkin, B. T.
Wells, Percy (Faversham)


Hunter, A. E.
Paton, John
Wells, William (Walsall, N.)


Hynd, H. (Accrington)
Pearson, A.
Wheeldon, W. E.


Hynd, J. B. (Attercliffe)
Peart, T. F.
White, Henry (Derbyshire, N.E.)


Irvine, A. J. (Edge Hill)
Pentland, N.
Wilkins, W. A.


Irving, Sydney (Dartford)
Plummer, Sir Leslie
Willey, Frederick


Janner, B.
Popplewell, E.
Williams, Rev. Llywelyn (Ab'tillery)


Jay, Rt. Hon. D. P. T.
Prentice, R. E.
Williams, Rt. Hon. T. (Don Valley)


Jager, George (Goole)
Price, J. T. (Westhoughton)
Willis, Eustace (Edinburgh, E.)


Jager, Mrs. Lena(Holbn &amp; St. Pncs, S.)
Price, Philips (Gloucestershire, W.)
Wilson, Rt. Hon. Harold (Huyton)


Jones, Rt. Hon. A. Creech(Wakefield)
Probert, A. R.
Winterbottom, Richard


Jones, Jack (Rotherham)
Pursey, Cmdr, H.
Woof, R. E.


Jones, J. Idwal (Wrexham)
Rankin, John
Yates, V. (Ladywood)


Kenyon, C.
Redhead, E. C.
Zilliacus, K.


Key, Rt. Hon. C. W.
Reeves, J.



King, Dr. H. M.
Reid, William
TELLERS FOR THE AYES:


Lawson, G. M.
Reynolds, G. W.
Mr. Holmes and Mr. Deer.


Lee, Frederick (Newton)
Rhodes, H.





NOES


Agnew, Sir Peter
Brooman-White, R. C.
Erroll, F. J.


Aitken, W. T.
Browne, J. Nixon (Craigton)
Farey-Jones, F. W.


Allan, R. A. (Paddington, S.)
Bryan, P.
Fell, A.


Amory, Rt. Hn. Heathcoat (Tiverton)
Burden, F. F. A.
Finlay, Graeme


Anstruther-Gray, Major Sir William
Butler, Rt. Hn. R. A. (Saffron Walden)
Fisher, Nigel


Arbuthnot, John
Campbell, Sir David
Fletcher-Cooke, C.


Armstrong, C.W.
Carr, Robert
Fort, R.


Ashton, H.
Cary, Sir Robert
Fraser, Hon. Hugh (Stone)


Atkins, H. E.
Channon, H. P. G.
Freeth, Denzil


Baldock, Lt.-Comdr. J. M.
Chichester-Clark, R.
Galbraith, Hon. T. C. D.


Baldwin, Sir Archer
Clarke, Brig. Terence (Portsmth, W.)
Gammans, Lady


Barber, Anthony
Cole, Norman
George, J. C. (Pollok)


Barlow, Sir John
Conant, Maj. Sir Roger
Glover, D.


Barter, John
Cooke, Robert
Glyn, Col. Richard H.


Bateford, Brian
Cordeaux, Lt.-Col. J. K.
Godber, J. B.


Baxter, Sir Beverley
Corfield, F. V.
Goodhart, Philip


Beamish, Col. Tufton
Craddock, Beresford (Spelthorne)
Gough, C. F. H.


Bell, Philip (Bolton, E.)
Crosthwaite Eyre, Col. 0. E.
Gower, H. R.


Bell, Ronald (Bucks, S.)
Crowder, Sir John (Finchley)
Graham, Sir Fergus


Bevins, J. R. (Toxteth)
Cunningham, Knox
Grant Rt. Hon. W. (Woodside)


Biggs-Davison, J. A,
Currie, G. B. H.
Green, A.


Bingham, R. M.
Dance, J. C. G.
Gresham Cooke, R.


Birch, Rt. Hon. Nigel
Davies, Rt. Hn. Clement(Montgomery)
Grimond, J.


Bishop, F. P.
D'Avigdor-Goldsmid, Sir Henry
Grosvenor, Lt.-Col. R. G.


Black, Sir Cyril
de Ferranti, Basil
Gurden, Harold


Body, R. F.
Doughty, C. J. A.
Hall, John (Wycombe)


Bonham Carter, Mark
du Cann, E. D. L.
Hare, Rt. Hon. J. H.


Bowen, E. R. (Cardigan)
Dugdale, Rt. Hn. Sir T. (Richmond)
Harris, Reader (Heston)


Boyd-Carpenter, Rt. Hon. J. A.
Duncan, Sir James
Harrison, A. B. C. (Maldon)


Boyle, Sir Edward
Eden, J. B. (Bournemouth, West)
Harrison, Col. J. H. (Eye)


Braine, B. R.
Emmet. Hon. Mrs. Evelyn
Harvey, John (Walthamstow, E.)


Brewis, John
Errington, Sir Eric
Heald, Rt. Hon. Sir Lionel







Heath, Rt. Hon. E. R. G.
Maitland, Cdr. J. F. W.(Horncastle)
Shepherd, William


Henderson-Stewart, Sir James
Maitland, Hon. Patrick (Lanark)
Simon, J. E. S. (Middlesbrough, W.)


Hicks-Beach, Maj. W. W.
Markham, Major Sir Frank
Spearman, Sir Alexander


Hill, Mrs. E. (Wythenshawe)
Marlowe, A. A. H.
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Hill, John (S. Norfolk)
Marples, Rt. Hon. A. E.
Stanley, Capt. Hon. Richard


Hinchingbrooke, Viscount
Marshall, Douglas
Stevens, Geoffrey


Hirst, Geoffrey
Mathew, R.
Steward, Harold (Stockport, S.)


Holland-Martin, C. J.
Mawby, R. L.
Steward, Sir William (Woolwich, W.)


Hornby, R. P
Maydon, Lt.-Comdr. S. L. C.
Stoddart-Scott, Col. Sir Malcolm


Horobin, Sir Ian
Medlicott, Sir Frank
Stuart, Rt. Hon. James (Moray)


Horsbrugh, Rt. Hon. Dame Florence
Molson, Rt. Hon. Hugh
Studholme, Sir Henry


Howard, John (Test)
Morrison, John (Salisbury)
Summers, Sir Spencer


Hughes Hallett, Vice-Admiral J.
Nairn, D. L. S.
Taylor, Sir Charles (Eastbourne)


Hurd, Sir Anthony
Neave, Airey
Taylor, William (Bradford, N.)


Hutchison, Michael Clark(E'b'gh, S.)
Nicholls, Harmar
Teeling, W.


Hylton-Foster, Rt. Hon. Sir Harry
Nicholson, Sir Godfrey (Farnham)
Temple, John M.


Iremonger, T. L.
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Thomas, Leslie (Canterbury)


Jenkins, Robert (Dulwich)
Noble, Michael (Argyll)
Thorneycroft, Rt. Hon. P.


Jennings, Sir Roland (Hallam)
Nugent, Richard
Thornton-Kemsley, Sir Colin


Johnson, Eric (Blackleg)
Oakshott, H. D.
Turner, H. F. L.


Keegan, D.
Ormsby-Gore, Rt. Hon. W. D.
Turton, Rt. Hon. R. H.


Kerby, Capt. H. B.
Osborne, C.
Tweedsmuir, Lady


Kerr, Sir Hamilton
Page, R. G.
Vane, W. M. F.


Kirk, P. M.
Pannell, N. A. (Kirkdale)
Vaughan-Morgan, J. K.


Lambton, Viscount
Partridge, E.
Vickers, Miss Joan


Lancaster, Col. C. G.
Peel, W. 3.
Vosper, Rt. Hon. D. F.


Langford-Holt, J. A.
Peyton, J. W. W.
Wakefield, Edward (Derbyshire, W.)


Leavey, J. A.
Pickthorn, Sir Kenneth
Wakefield, Sir Wavell (St.M'lebone)


Leburn, W. G.
Pike, Miss Mervyn
Walker-Smith, Rt. Hon. Derek


Legge-Bourke, Maj. E. A. H.
Pilkington, Capt. R. A.
Wall, Patrick


Legh, Hon. Peter (Petersfield)
Pitman, I. J.
Ward, Rt. Hon. G. R (Worcester)


Lindsay, Hon. James (Devon, N.)
Pott, H. P.
Ward, Dame Irene (Tynemouth)


Lindsay, Martin (Solihull)
Powell, J. Enoch
Watkinson, Rt. Hon. Harold


Linstead, Sir H. N.
Price, David (Eastlelgh)
Webbe, Sir H.


Lloyd, Maj. Sir Guy (Renfrew, E.)
Prior-Palmer, Brig. 0. L.
Webster, David


Longden, Gilbert
Ramden, J. E.
Williams, Paul (Sunderland, S.)


Loveys, Walter H.
Redmayne, M.
Williams, R. Dudley (Exeter)


Low, Rt. Hon. Sir Toby
Rees-Davies, W. R.
Wills, Sir Gerald (Bridgwater)


Lucas, Sir Jocelyn (Portsmouth, S.)
Remnant, Hon. P.
Wilson, Geoffrey (Truro)


Lucas, P. B.(Brentford &amp; Chiswick)
Ridsdale, J. E.
Woollam, John Victor


Lucas-Tooth, Sir Hugh
Robinson, Sir Roland (Blackpool, S.)
Yates, William (The Wrekin)


Macdonald, Sir Peter
Roper, Sir Harold



McLaughlin, Mrs. P.
Ropner, Col. Sir Leonard
TELLERS FOR THE NOES:


Macleod, Rt. Hn. lain (Enfield, W.)
Russell, R. S.
Mr. Hughes-Young and


Macmillan, Rt. Hn. Harold(Bromley)
Sharpies, R. C.
Mr. Whitelaw.

Mr. Douglas Jay: I beg to move, in page 14, line 27, at the end to insert:
(4) In subsection (1A) (appropriate amounts for child relief) of section two hundred and twelve of the Income Tax Act, 1952, references to one hundred and seventy-five pounds, one hundred and fifty pounds and one hundred and twenty-five pounds shall be substituted respectively for references to one hundred and fifty pounds, one hundred and twenty-five pounds and one hundred pounds (indicating the amount of the relief at various ages of the child).

The Chairman: With this Amendment I think we can discuss the new Clause "Children", on page 2290 of the Notice Paper, in the name of the hon. and gallant Member for Cheltenham (Major Hicks Beach).

Mr. Jay: This Amendment has the simple purpose of enlarging the Income Tax child allowance at all the three stages into which it is now divided. I have often moved similar Amendments before, and have often declared an interest in them. The interest is so widely shared that it is hardly worth declaring, but, on

the other hand, the Chancellor of the Exchequer, if he were here, would be a standing proof that it is not universally shared, and therefore I mention the point.
This Amendment to raise the child allowance and thereby give further Income Tax reliefs to families—which is one of the alternatives Which we would like to have seen adopted to the straight, sweeping reduction in the standard rate of tax—has many merits Ito recommend it. One is that it is extremely simple. Everybody can understand What is involved in having children, and everybody can understand what a relief for each extra dependent child in the family means. Whether or not we are fully conversant with dividend stripping, bond-washing, or even some of the more complicated Income Tax allowances, we can all understand what is proposed here.
The second great merit of this proposal is that, on grounds of equity, this form of relief has more to recommend it than almost any other form of relief from Income Tax one can propose. I will not


argue this case on the ground of incentives, which are no doubt important in their own way. We agree that they are important, but we also think that the equity of the tax is important too, and if we look to the argument of equity, the case for the child relief is extremely strong.
Many of us, looking at Income Tax, feel inclined to argue on equity grounds that it is about time a large number of those with the smallest incomes were swept out of tax liability altogether. There are several million people in this country paying very small amounts of Income Tax which do not add up to a large total. I believe it is true that in the case of the 5 million or 6 million people, who are one-third of the Income Tax payers, the total tax they pay is £50 million at the outside, and the total Income Tax yield is £2,000 million or more. Therefore, one is inclined to sweep away the 5 million by what the plain man would call raising the exemption limit.
Although we could devise a method for cutting out those paying the smallest amount of tax, that proposal, though it has something to be said for it, is open to criticism in that a high proportion of those individuals are single juveniles who, though their incomes are low, nevertheless are not the people most in need, since they do not have anybody else to support out of their incomes. Therefore, purely on grounds of equity, that argument is not as attractive as it looks compared with this one, and the case for the child allowance is even stronger.
The second ground on which I would justify it from the point of view of equity is the following. I believe it is still true—the Financial Secretary can tell me if I am wrong, because I have not got the exact figures—that if we make a comparison in this way, and if we make a correction for the decline in the value of money, we find that the child allowance in any of the three hands is actually less today than it was before the wartime changes in Income Tax were made. Indeed, this is just one more proof that in some respects Income Tax today is more regressive than it was in the years immediately before the war.
The simplest—one might say the crudest—but to me the valid test of the

strange way in which our Income Tax system, in spite of all the allowances, still bears hardly on the family, is to make the straight calculation of what is the income per head after tax in each family. After all, what determines the standard of living, broadly speaking, is the income left after tax, divided by the number of the people in the family.
I am far from suggesting that in this country we should base our Income Tax solely on that consideration, taking each individual separately, but it is always worth remembering that, in principle, this is the system in force in France. It was one of the most interesting points made by the Royal Commission on Taxation that in France they do not take the income of the earner of the household and consider this as one unit, with certain small adjustments. They divide the income by three or five or some other figure for the individuals in the family and then charge Income Tax approximately on the remaining figure. I think it is called the quotient system.
I am not suggesting that we should do that here, but I would draw the attention of the Financial Secretary to the way in which the figures work out under our system. If we take, on the one hand, the single man or woman who is earning and solely supporting himself or herself, and, on the other, the man with a wife and three children, and if we calculate in each case what is the income per head after tax in each of those families, we reach what always seems to me a rather surprising result. I find that the ratio is about the same, in spite of changes made in intervening years, as it was a few years before, whether we take the level of £10, £20 or £30 a week. There may be some mathematical reason about which I do not know, but it works out the same. We find that the single man is four and a quarter times better off than the family of five.
I have tried to allow for family allowances, though my calculation is fairly simple, but at all those levels the income of a single man is about four and a quarter times higher than that of the family. That is a remarkable difference. It means that to a great extent inequalities in the standard of living are more dependent on the number of dependants per earner in a household than they are on differences between gross income.
6.30 p.m.
It may be said that this is all very obvious and that if people have large families and have a number of dependants to support, they will naturally be very much worse off than if they were single earners who had no such responsibilities. That is true, but it does not dispose of the matter. We are, after all, looking at this from the point of view of equality in taxation. We are not just trying to discover how this rather curious ratio comes about.
If one looks at it from the point of view of equity and ethics, one might well say that if a man and woman choose to have so many children, that is purely their responsibility, that the results must fall on them and that they cannot try to push the responsibility off on the rest of the community by wanting huge taxation reliefs. At the same time, however, one has to remember that the resulting inequalities of the lowering of the standard of living fall not merely on the earner but on the children in the family. This is one case where by no possible argument can we say that a moral responsibility rests on the other members of the family, who are, clearly, not accountable for the household in which they happen to live.
Therefore, I do not think that one can just brush the calculation aside and say that no doubt everybody in a large family is much worse off than if they were in a small one and that that is their fault and responsibility. It is rather surprising that, in spite of our family allowances and system of child allowances for Income Tax, which at first sight look considerable and generous, there is this extraordinary difference between the single earner and the family with two, three or four children if one works out the simple calculation of the income per head after taxation.
For all these reasons—this is a much simpler subject than some even though the arithmetic is not wholly simple—I think that among the possible allowances—if we are looking at equity and at adjusting our tax system to capacity to pay, which, in a sense, is the oldest and most traditional test of a good taxation system, as calculated by the actual standards of living of the people affected—there remains an extremely strong case year by year for fairly generous relief by way of this tax allowance.
I say this to the Financial Secretary and the Economic Secretary not in the confident hope that they will immediately accept my argument and the Amendment today, but because I strongly believe that, not just this year but year by year, this is an extremely important element in our whole direct taxation system. If they do not, by some miraculous feat of intelligence, accept my Amendment today, and if by some even more miraculous stroke of ill luck they are still here in the future, I hope that they will keep these arguments firmly in mind.

Dr. Horace King: I want to put to the Committee what is perhaps a new point in the long discussion that we have had on this matter from year to year. I do so from my intimate knowledge of one learned profession which is affected by the point that I shall try to make.
We are moving steadily towards equal pay for men and women. Within two or three years in most of the professions in this country, and, indeed, eventually in all occupations, men will be paid the same as women. One of the old arguments against equal pay—I think that it was a false argument—was that a married man was much worse off than a single woman earning the same money. The fallacy in that is that the real discrepancy on which the opponents were basing their case is the discrepancy which still exists between the standard of living of the married man, especially the married man with children, and the single person, of whatever sex, earning the same salary. It is that economic difference, that difference in the standard of living, that the Amendment seeks to improve a little.
I believe that the fact that the professions are moving towards equality of pay as between men and women and that in the teaching profession, my own profession, year by year more than 100,000 women are receiving equal pay, means that much more notice will be taken by the married folk of the country of the discrepancy that exists between them and the single person earning exactly the same money. I know, for example, that many members of the teaching profession are suggesting that there should be a family allowance as part of the salary scale. University professors already have it. I do not think that that is the real solution to the problem. The solution is not one


to be tackled piecemeal by separate professions. The discrepancy is national. It is one to be tackled by the whole country, because the sense of injustice as between the married person and the single person runs through the whole of the national system. It could easily revive sex-antagonism on a fallacious basis.
I find, for instance, that those who resist wage and salary increases very often base their resistance on the standard of living that a certain salary or wage represents for the single earner. All hon. Members, however, will know that such a salary or wage does not represent the same standard of living for the married man, especially the married man with children.
The Royal Commission on the Taxation of Profits and Income stated the issue clearly for all time in its second Report. Speaking of the married man with two children, it said:
The married man's income has to support four people and there is nothing manifestly unfair in attributing to it the same taxable capacity as that of a single man supporting himself on about one-third of the income.
It is towards that conception that we have to move as we build up the reliefs in Income Tax for the married person with children.
I most sincerely congratulate the present Government and the Socialist Government which preceded it on what they have done during the last few years. In 1950–51, the allowance was £60 for all children. In 1951–52, it was raised to £70; in 1952–53, to £85; in 1955–56, to £100; and in 1957–58 it was raised to the differentiated pattern, for children of various ages, referred to in the Amendment, of £100, £125 and £150. The Government have also made a similar, but not quite so significant, increase in the Income Tax allowance for a man's wife, but I still do not believe that we are doing enough in the fiscal field for the family man. I do not believe that we do enough in taxation relief for the family, and the family is the backbone of British life.
It is common knowledge to every father or grandfather in the Committee that children are costing more year by year. This results not merely from the rise in the cost of living, but from the rise in the demands of the young population for all kinds of things which we did not have

as children. If the Chancellor could afford to make the concessions that we seek, they would represent in a year perhaps the cost of clothing or of providing boots for the children, and this would at any rate narrow to some extent, justifiably I believe, the gap in the standard of living between the single person and the married person doing exactly the same job and receiving exactly the same income but having a widely differing standard of living which they manage to obtain from that income. I hope that the Chancellor will give serious consideration to our proposal.

Viscount Hinchingbrooke: I understand that with this Amendment there is being taken a new Clause in the name of my hon. and gallant Friend the Member for Cheltenham (Major Hicks Beach). However, none of my hon. Friends who put their names to that new Clause is in the Chamber. I do not know the machinery in these affairs. It is a little unfortunate suddenly to jump into the middle of a new Clause. There is sometimes provision for placing Schedules against related Amendments on the Notice Paper so that we at least know that they are to be taken together.
I suppose that even if hon. Members think that the new Clauses are not to be taken until two or three weeks from now, they should still go to the Chair and say, "Please, Sir Charles, by any chance is my Clause being taken today with any Amendment?" Now that we have Clauses and Amendments numbered, we might look into the whole machinery whereby hon. Members are advised that their Clauses are to be taken with certain Amendments. I hope that that will be done.
I doubt very much whether the Government will accept this year what the Amendment suggests. There have been many other concessions and in recent years, notably under my right hon. Friend the Member for Monmouth (Mr. P. Thorneycroft), there have been changes in the amount of children's allowances. We have been progressing steadily and satisfactorily towards a situation in which people with middle and moderate incomes are enabled to receive such allowances for marriage and children that they are carried out of the taxation ranges altogether.
For example, anyone who is married with two children over 16 and is earning a salary of £900 or less does not pay any tax. Looked at starkly like that, it is staggering to see what happened in the years before and immediately after the war, when some of these benefits had not been conferred. We should rejoice in that and if we had time to study the matter I have no doubt that we would find that we could congratulate right hon. and hon. Gentlemen opposite as much as ourselves.
Nevertheless, there are still very large gaps. There is a very interesting, if alarming, table on page 83 of the second Report of the Royal Commission on the Taxation of Profits and Income, which may not be accurate now since it was for the taxation scales of 1953–54. However, it shows the discrepancy in the weight of taxation at that time and before the war at various levels of income. This table also refers to married persons with two children.
According to those figures, a family of that kind, with an income of £800 a year, at that time was paying thirteen and a half times as much Income Tax as it was in 1928–39. Of course, the Income Tax paid in 1938–39 was not very large, and one cannot go lower down the scale and talk about incomes of £750 or £700 or less without making the argument absurd and getting into infinite scales. Families with incomes of £850 paid eight times as much as pre-war; incomes of £900, six and a half times as much; and of £950 five times as much.
It then goes sharply down so that incomes of £1,500 and above paid as much again as before the war. That rate of as much again runs up to the top incomes. It is round about the class of persons earning about £800 to £1,200 that the tremendous differential of taxation today compared with taxation before the war is applied. It is towards that class that the Government should direct their closest attention next year.
6.45 p.m.
I hope that we shall get away from this comparatively unsatisfactory system of allowances and get to a proportionate basis. For instance, if we said that one-tenth of a person's income, irrespective of the size of the income, so that it

would operate throughout Surtax, should be allowed per child, or some ratio of that kind, we should do far more justice to those people who most deserve justice, namely, the class to which I have just referred, and we should not militate against what we have done for people in the lower income groups.

Mr. Jay: The noble Lord will realise that in a sense the present system is proportionate since those people with higher incomes who get the larger reliefs have to pay more.

Viscount Hinchingbrooke: But that is infinitesimal. I should have thought that the right non. Gentleman himself, with his level of salary, received a very unsatisfactory allowance in respect of his children, two of whom, I know, are at university. The amount of child allowance at certain levels of income is out of all proportion to the responsibilities discharged by the parents.
It may be that this is a simple party issue, but I do not believe that there is any point in remitting it to a Royal Commission or other neutral body, because we should receive only a neutral answer. The Royal Commission did not dare to make what I and, I am sure, my right hon. Friend consider the real changes which should be made in this aspect of taxation. I hope that, in spite of that, the Government, which will be the same Government, will have the courage to do something of the kind next year.

Mr. J. Grimond: We have had three reasonable and well reasoned speeches in favour of the principle behind the Amendment, which should commend itself in principle to the Government as well as to the Committee since it recognises that relief should be given to families. We have had a very welcome reduction in Income Tax this year and progressively over the years we have built up a system of reliefs.
I do not want to go over the arguments for and against this suggestion, which were eloquently deployed by the right hon. Member for Battersea, North (Mr. Jay), nor do I want to reiterate the extremely important argument of the hon. Member for Southampton, Itchen (Dr. King), which will be extremely important to the teaching profession as equal pay becomes more general throughout the system.
There are arguments against this proposal. It might be said that everyone is entitled not to have a family and that to have a family is enjoyable and that one must he prepared to bear some extra cost because of it. Nevertheless, it is not a form of life which we should single out for high taxation. In spite of the concessions, do not the Government agree that the position of the family man, at any rate in certain trades, is worse than it was? It is a complicated matter, because there are alterations in the value of money and allowances and the whole tendency in the economy as it gets richer is for people to move into higher brackets of income so that what appears to be a substantial reduction in tax in real terms may turn out to be rather different from what it first appears to be.
Having made substantial concessions, I think that the Government will be unable to agree to accept the Amendment this year, but I add my plea to those who have asked the Government to accept it in principle. I should appreciate a lucid statement from the Government on the tax position of the family man and whether it is true, as I suspect, that the figures given by the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) are correct in indicating that in certain classes the family is still taxed unduly heavily. Will the Government say whether they favour themselves or their successors reviewing the position?

Major W. Hicks Beach: I am happy to hear that the new Clause, "Children", standing in my name—
Section two hundred and twelve of the Income Tax Act, 1952, as amended by section twelve of the Finance Act, 1957, shall be read and have effect as if in subsection (4) thereof (which subsection limits by reference to the child's income the relief allowed in respect of the child) in place of the words "income exceeding one hundred pounds a year" there were substituted the words "annual income exceeding the appropriate amount for the child"—
is being discussed with this Amendment.
May I briefly explain the purpose of the new Clause? The present position under the Income Tax Acts is that where a child is a beneficiary under a settlement the parent of that child is entitled to claim the ordinary child allowance, which we know is now £150 a year, provided that the income from the settlement in which the child has an interest is not more than £120 a year. Since the war

children's allowances have steadily increased. The amount which a child is entitled to receive under a settlement without the parent losing the allowance has not been kept in line with the child's allowance.
I should have thought that that was a gross and probably quite unintentional anomaly on the part of the Inland Revenue. The purpose of my new Clause is a simple one. It is to ensure that the child allowance as such should be tied to the amount to which a child is entitled from an outside income under a settlement and that the parent should not lose the child allowance. Since the war all the evidence shows that the child allowance and the independent income allowance of the child has been tied to the allowance which the parents can claim. If the hon. and learned Gentleman studies this matter, I think he will accept my new Clause as bringing into line what has, until the last four years, been the policy of Governments of both parties, and which is in conformity with the general taxation policy.

Mr. Simon: This has been an extremely interesting debate which has ranged pretty wide into the social purpose that lies behind this particular relief. If he will forgive me, I do not think I will follow the right hon. Gentleman the Member for Battersea, North (Mr. Jay) into the French tax code, which is based on a completely different property relationship between the spouses.
It is clear that there is always a discrepancy between the standard of living of the single man and the married man without a family on the one hand, and those who have a large family of young children to bring up on the other. That has always been so. Hon. Members of the Committee will call to mind Trollope's juxtaposition of the Warden on the one hand and the Rev. Mr. Quiverful on the other. That is a feature that has gone on throughout social history. Nor indeed is it the purpose of this allowance to correct that. It is to go some way towards correcting it, but none of these reliefs are intended to indemnify the taxpayer against the cost in respect of which they are granted. It is to some extent to temper the wind to the shorn lamb—to take us back again, as I said earlier, repeating the Royal Commission, to the system of graduation.
This relief takes its place with the various social payments like the family allowances and the cognisance which the National Assistance Board takes of family circumstances. That is not to say that this relief has not got an important social or fiscal purpose, and when the hon. Member for Orkney and Shetland (Mr. Grimond) asks me whether the Government are committed to this in principle, I think the answer is clearly "Yes", for the reasons very fairly given by the hon. Member for Southampton, Itchen (Dr. King). That is shown by the action of the Government.
I cannot advise the Committee to accept the Amendment for two main reasons. First, this allowance has been pretty generously treated in recent years. It was increased in the 1951 Socialist Budget from £60 to £70. It is true that that was concomitant with an increase in the standard rate of Income Tax, but it was nevertheless a conscious differentiation in favour of the family man.
The allowance has been increased three times under Tory Governments. The first time it was increased from £70 to £85 in 1952. Then came the observations of the Royal Commission to which the hon. Member for Itchen and my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) drew attention. I think it was partly in consequence of those observations that the allowance was increased to £100 in 1955. In 1957 it was increased again by my right hon. Friend the Member for Monmouth (Mr. P. Thorneycroft)—to £150 in the case of children over 16—to take account of the greater expense of maintaining the older dependent children.
Those are substantial increases over a comparatively short period of years. As my right hon. Friend the Chancellor reminded the Committee, it amounts to an increase of over 40 per cent. in the case of the allowance for children under 11 years of age; 80 per cent. for children between 11 and 16; and more than double for children over 16.
The important thing to remember, and it is not always kept in sight by commentators on our fiscal system, is that an allowance improved like that enures not only in the year that it is granted, but from year to year. In approving Clause 14, the general Clause imposing the new

rates of Income Tax, the Committee has approved that there shall be those increased benefits which were conferred in 1951, 1952, 1955 and 1957, all of them continuing again to the benefit of the family man in the coming Income Tax year.
The second, and conclusive, reason why it would be wrong for the Committee to accept the Amendment is the cost. It costs £42 million. The Committee has already approved the reduction in the standard rate of Income Tax, and the reduction in the reduced rates must necessarily follow. It seems to me that nobody in any part of the Committee could really contemplate adding £42 million to the sum which should be borrowed this year. It must necessarily follow that the Committee should disapprove the Amendment, although I understand very well the reasons why it has been put forward from the benches opposite.
7.0 p.m.
I propose now to refer to the new Clause in the name of my hon. and gallant Friend the Member for Cheltenham (Major Hicks Beach). I think I may deal with it quite briefly. My first point is that there is no necessary equivalence between the income limit and the amount of the child's allowance. That point was made by my predecessor in 1957 and I need not repeat the arguments which he gave at length. Secondly, this allowance is intended for those with dependent children, and it has always been recognised that there must come a point at which it is excessive both to give the parent an allowance for his child and to give the child the ordinary single person's allowance against his own income. The two allowances together means that there is in the case of a child, that is, a child under 11, an income of £200 which is exempt—£100 of the child's income and £100 of allowance. Of course, if the child is older, the amount will be different.
We have to compare that £200 of exempt income with the exempt income of £180 for a single person under 65 years of age. Therefore, again we come back to the situation that it would be inequitable to move one of these rates without a general increase in the personal allowances; and it seems to me that the right time to review the point made so


cogently and forcibly by my hon. and gallant Friend would be when the personal allowances generally are being reviewed.
There is one further reason which I am bound to mention. It is that his proposal would cost £2 million in a full year. That is not a sum that my right hon. Friend could find after the very substantial remissions which he has made. For those reasons, I must ask the Committee to vote against the Amendment, if the matter is taken to a Division, and I hope that my hon. and gallant Friend will ask leave to withdraw his New Clause.

Mr. Ede: We have had a very interesting discussion on this Amendment. Every speaker has devoted some part of his argument to how this form of taxation may be used to secure some kind of social justice which is rather more easily recognisable than the present system. I was particularly impressed by the comparisons given by the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) illustrating the amount paid in taxation in some cases today and what was paid in the years before the war.
When discussing this matter with younger friends of mine who are now bringing up families, I find is very difficult to ascertain exactly how the burden of bringing up a family today compares with the situation before the war. Of course, I can go back even further than that in my own recollection. I can recall the way in which I was brought up and the apparent cost of bringing up a family in those days. I was the eldest of a family of four, and the youngest was only three years and six months younger that I was. We were the kind of family in which the members were happy only if they worked in with the family. In many ways I think that where the children are so nearly of the same age that they are naturally companionable, if they are of that frame of mind, is the ideal form of family.
It would be interesting to have some investigation into the problems raised by the noble Lord. There is no doubt that the standard of expectation of a child has altered since the remote time when one's weekly allowance could be assessed in the form of ginger beer. It would be

interesting to compare the situation then with what happens today.
When I was Home Secretary I was once consulted about the allowances to be paid to children who were under the control of various bodies over which I had some supervision. If we take the ginger beer standards, a bottle of ginger beer in my day cost 1d. But try to get a battle of ginger beer today for 1d. So far as the child is concerned, the cost of living appears to have increased by 500, 600 or 700 per cent. One does not wish to carry these 'analogies too far, but undoubtedly a problem confronts parents in receipt of a reasonable income of, say, £1,000 or £1,200 a year, who are trying to bring up three or four children reasonably well without being extravagant. In the light of the figures and comparisons brought to our notice today by the noble Lord the Member for Dorset, South, I hope that in future discussion's on this matter we shall be able to compare conditions in pre-war days with those prevailing today.
One of the things which always astonishes me is the high proportion of single English women, compared with other members of the English community, that one meets if one happens to be enjoying a holiday at some foreign resort. It seems to indicate that the standard of living which may be enjoyed in this day and age by single people with no family obligations cannot be experienced by parents confronted with the task of bringing up a family.
I regret that these proposals will cost too much to implement. I find some consolation in the thought that as the £2 million which represents the cost of implementing the proposals of the hon. and gallant Member for Cheltenham (Major Hicks Beach) would ruin this Budget, the eminently reasonable proposals of my right hon. Friend the Member for Battersea, North (Mr. Jay), which would cost £42 million, must be regarded as a wrecking Amendment. I am sure that no one would wish to wreck the Budget on such a fine afternoon as this.

Mr. Jay: I thought that the Financial Secretary was a little unsympathetic to the various arguments which have been advanced and that he used one or two rather curious arguments. My right hon. Friend the Member for South Shields (Mr. Ede) has spoken of the comparisons


between present-day conditions and prewar conditions, as did the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke). I asked the Financial Secretary whether the child allowance today, after all these increases which the hon. and learned Gentleman rightly enumerated, was as high as it would have to be in order to command the same purchasing power and to allow for the fall in the value of money.

Mr. Simon: I need hardly say that it was not an intentional discourtesy on my part that I did not answer the question of the right hon. Gentleman. The reason was that I have not the figures available.

Mr. Jay: I was not reproaching the Financial Secretary. I was about to say that I have myself made the calculation. Apparently the hon. and learned Gentleman cannot contradict me, and so I will give him the result of my calculations.
According to my researches, the child allowance before the war was £60. During the war it went down and it has now risen by three bands—£100, £125 and £150. I do not wish to commit myself over the cost of ginger beer, which was mentioned by my right hon. Friend the Member for South Shields, but it is usual in such estimates to multiply by three in order to allow for the fall in the value of money since 1938. Therefore, if there has not been an actual deduction in this allowance, it should stand at about £180 today.
In 1954, the Royal Commission recommended a figure of £160. In fact the figure has been £100, £125, and £150 so that, in effect, in real terms, the allowance is lower than before the war. That is also relevant to what was said by my hon. Friend the Member for Southampton, Itchen (Dr. King). We are moving into a period when equal pay will become much more prevalent both in public and private service. That is, indeed, as he rightly said, an argument both for increasing family allowances and the child allowances for Income Tax purposes. On those grounds alone it would seem that these allowances should be larger in real terms and not, as they are, smaller than pre-war.
The Financial Secretary used one rather extraordinary argument. He said that

the reliefs given by way of child allowances in previous years were being continued and that in voting Clause 12 we should, so to speak, be re-enacting them. I think we all realise that, but it is rather extraordinary that in refusing to give one relief the Financial Secretary should take credit for not taking back another relief. We do not accept that the Financial Secretary, in refusing to increase the child allowance, can take credit for continuing those allowances. I must remind him that in this Budget greater reliefs have been given to the single person than to the earner with dependants and that in each case the more dependants he has the less relief he gets from the Budget. I must say that as the Financial Secretary actually claims credit for what has been done in the Budget.
The Financial Secretary to the Treasury finally said, "Of course, these allowances are not intended to restore the situation as it would be if the taxpayer had no children at all." I am aware of that. I remember saying that to my own father in 1920, when he was complaining about the inadequacy of the child allowance. The allowances are merely intended to go some way towards bridging the gap. Our case is that they do not go far enough. We do not argue that a man with a wife and three children should be exactly as well off after tax per head as if he were a single earner.
If, as a result of all our child allowances and fiscal arrangements today, the single man were twice as well off as the man with a wife and three children, that might be reasonable, but he is more than four times as well off. I think that the figure is something like four and a quarter times. If we had no taxation system at all, the single man might be five times as well off, but the whole effect of Income Tax and child allowances makes him four and a quarter times better off. That seems to us to go very little way indeed. Therefore, I hope that the Committee, in order to point this argument, will divide in favour of the Amendment.

Question put, That those words be there inserted:—

The Committee divided: Ayes 177, Noes 214.

Division No. 110.]
AYES
[7.14 p.m


Ainsley, J. W.
Hall, Rt. Hon. Glenvil (Caine Valley)
Parker, J.


Albu, A. H.
Hamilton, W. W.
Paton, John


Allaun, Frank (Salford, E.)
Hannan, W.
Pearson, A.


Allen, Arthur (Bosworth)
Hastings, S.
Peart, T. F.


Allen, Scholefield (Crewe)
Hayman, F. H.
Pentland, N.


Awhery, S. S.
Healey, Denis
Plummer, Sir Leslie


Bacon, Miss Alice
Henderson, Rt. Hn. A. (Rwly Regis)
Popplewell, E.


Bence, C. R. (Dunbartonshire, E.)
Herbison, Miss M.
Prentice, R. E.


Benn, fin. Wedgwood (Bristol, S.E.)
Hewitson, Capt. M.
Probert, A. R.


Benson, Sir George
Hobson, C. R. (Keighley)
Pursey, Cmdr. H.


Blackburn, F.
Holman, P.
Rankin, John


Blenkinsop, A.
Houghton, Douglas
Redhead, E. C.


Blyton, W. R.
Hughes, Cledwyn (Anglesey)
Reeves, J.


Boardman, H.
Hughes, Enlrya (S. Ayrshire)
Reid, William


Bottomley, Rt. Hon. A. G.
Hughes, Hector (Aberdeen, N.)
Reynolds, G. W.


Bowden, H. W. (Leicester, S.W.)
Hunter, A. E.
Rhodes, H.


Bowles, F. G.
Hynd, H. (Accrington)
Robens, Rt. Hon. A.


Brockway, A. F.
Hynd, J. B. (Attercliffe)
Roberts, Goronwy (Caernarvon)


Broughton, Dr. A. D. D.
Irving, Sydney (Dartford)
Robinson, Kenneth (St. Pancras, N.)


Brown, Rt. Hon. George (Belper)
Janner, B.
Rogers, George (Kensington, N.)


Brown, Thomas (Ince)
Jay, Rt. Hon. D. P. T.
Ross, William


Burke, W. A.
Jeger, George (Goole)
Royle, C.


Burton, Miss F. E.
Jeger, Mrs. Lena(Holbn &amp; St. Pncs, S.)
Shinwell, Rt. Hon. E.


Butler, Herbert (Hackney, C.)
Jones, Rt. Hn. A. Creech(Wakefield)
Short, E. W.


Carmichael, J.
Jones, Jack (Rotherham)
Silverman, Julius (Aston)


Castle, Mrs. B. A.
Jones, J. Idwal (Wrexham)
Silverman, Sydney (Nelson)


Champion, A. J.
Kenyon, C.
Simmons, C. J. (Brlerley Hill)


Chapman, W. D.
Key, Rt. Hon. C. W.
Slater, J. (Sedgefield)


Chetwynd, G. R.
King, Dr. H. M.
Smith, Ellis (Stoke, S.)


Coldrick, W.
Lawson, G. M.
Snow, J. W.


Collick, P. H. (Birkenhead)
Lee, Frederick (Newton)
Sorensen, R. W.


Corbet, Mrs. Freda
Lee, Miss Jennie (Cannock)
Spriggs, Leslie


Craddock, George (Bradford, S.)
Lindgren, G. S.
Stones, W. (Consett)


Cronin, J. D.
Lipton, Marcus
Strauss, Rt. Hon. George (Vauxhall)


Crossman, R. H. S.
Mahon, Dr. J. Dickson
Summerskill, Rt. Hon. E.


Davies, Ernest (Enfield, E.)
McAllister, Mrs. Mary
Sylvester, G. 0.


Davies, Harold (Leek)
McInnes, J.
Taylor, Bernard (Mansfield)


Davies, Stephen (Merthyr)
McKay, John (Wallsend)
Taylor, John (West Lothian)


Deer, G.
McLeavy, Frank
Thomas, lorwerth (Rhondda, W.)


Delargy, H. J.
MacPherson, Malcolm (Stirling)
Thomson, George (Dundee, E.)


Diamond, John
Mahon, Simon
Thornton, E.


Ede, Rt. Hon. J. C.
Mann, Mrs. Jean
Tourney, F.


Edelman, M.
Marquand, Rt. Hon. H. A.
Vlant, S. P.


Edwards, Rt. Hon. John (Brighouse)
Mason, Roy
Watkins, T. E.


Edwards, Rt. Hon. Ness (Caerphilly)
Mayhew, C. P.
Weitzman, D.


Edwards, W. J. (Stepney)
Monslow, W.
Wells, William (Walsall, N.)


Evans, Albert (Islington, S.W.)
Moody, A. S.
W heeldon, W. E.


Fernyhough, E.
Morris, Percy (Swansea, W.)
White, Henry (Derbyshire, N.E.)


Fletcher, Eric
Mort, D. L.
Wilkins, W. A.


Forman, J. C.
Moss, R.
Willey, Frederick


Fraser, Thomas (Hamilton)
Moyle, A.
Williams, Rt. Hon. T. (Don Valley)


Gibson, C. W.
Mulley, F. W.
Willis, Eustace (Edinburgh, E.)


Gooch, E. G.
O'Brien, Sir Thomas
Wilson, Rt. Hon. Harold (Huyton)


Greenwood, Anthony
Oliver, G. H.
Winterbottom, Richard


Grenfell, Rt. Hon. D. R.
Oram, A. E.
Woof, R. E.


Grey, C. F.
Orbach, M.
Yates, V. (Ladywood)


Griffiths, David (Rother Valley)
Oswald, T.
Zilliacus, K.


Griffiths, Rt. Hon. James (Lianelly)
Owen, W. J.



Griffiths, William (Exchange)
Padley, W. E.
TELLERS FOR THE AYES:


Hale, Leslie
Palmer, A. M. F.
Mr. Holmes and Mr. J. T. Price.




NOES


Agnew, Sir Peter
Bishop, F. P.
Cordeaux, Lt.-Col. J. K.


Aitken, W. T.
Black, Sir Cyril
Corfield, F. V.


Amory, Rt. Hn. Heathcoat (Tiverton)
Body, R. F.
Craddock, Beresford (Spelthorne)


Anstruther-Gray, Major Sir William
Bowen, E. R. (Cardigan)
Crosthwaite Eyre, Col. 0. E.


Arbuthnot, John
Boyd-Carpenter, Rt. Hon. J. A.
Crowder, Sir John (Finchley)


Armstrong, C. W.
Boyle, Sir Edward
Cunningham, Knox


Ashton, H.
Brains, B. R.
Dance, J. C. G.


Atkins, H. E.
Brewia, John
Davles, Rt. Hon. Clement(Montgomery)


Baldock, Lt.-Cmdr. J. M.
Brooman-Whlte, R. C.
D'Avigdor-Goldsmid, Sir Henry


Baldwin, Sir Archer
Browne, J. Nixon (Craigton)
de Ferranti, Basil


Barber, Anthony
Burden, F. F. A.
Doughty, C. J. A.


Barlow, Sir John
Butler, Rt. Hn. R. A.(SaffronWalden)
du Cann, E. D. L.


Barter, John
Campbell, Sir David
Dugdale, Rt. Hn. Sir T. (Richmond)


Batsford, Brian
Carr, Robert
Duncan, Sir James


Beamish, Col. Tufton
Cary, Sir Robert
Eden, J. B. (Bournemouth, West)


Bell, Philip (Bolton, E.)
Channon, H. P. G.
Elliott, R.W.(Ne'castle upon Tyne, N.)


Bevins, J. R. (Toxteth)
Clarke, Brig. Terence (Portsmth, W.)
Emmet, Hon. Mrs. Evelyn


Biggs-Davison, J. A.
Cole, Norman
Errington, Sir Eric


Bingham, R. M.
Conant, Maj. Sir Roger
Erroll, F. J.


Birch, Rt. Hon. Nigel
Cooke, Robert
Fell, A.







Finlay, Graeme
Kerr, Sir Hamilton
Redmayne, M.


Fisher, Nigel
Kirk, P. M.
Rees-Davies, W. R.


Fletcher-Cooke, C.
Lambton, Viscount
Remnant, Hon. P.


Fort, R.
Lancaster, Col. C. G.
Ridsdale, J. E.


Freeth, Denzil
Langford-Holt, J. A
Robinson, Sir Roland(Blackpool, S.)


Galbraith, Hon. T. G. D.
Leavey, J. A.
Roper, Sir Harold


Gammans, Lady
Legge-Bourke, Maj. E. A. H.
Ropner, Col. Sir Leonard


George, J. C. (Pollok)
Legh, Hon. Peter (Petersfield)
Russell, R. S.


Glover, D.
Lindsay, Hon. James (Devon, N.)
Sharpies, R. C.


Glyn, Col. Richard H.
Lindsay, Martin (Solihull)
Shepherd, William


Godber, J. B.
Linstead, Sir H. N.
Simon, J. E. S. (Middlesbrough, W.)


Goodhart, Philip
Lloyd, Maj. Sir Guy (Renfrew, E.)
Spearman, Sir Alexander


Gough, C. F. H.
Longden, Gilbert
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Gower, H. R.
Loveys, Walter H.
Stanley, Capt. Hon. Richard


Graham, Sir Fergus
Lucas, P. B. (Brentford &amp; Chiswick)
Stevens, Geoffrey


Grant, Rt. Hon. W. (Woodside)
Lucas-Tooth, Sir Hugh
Steward, Harold (Stockport, S.)


Green, A.
Macdonald, Sir Peter
Steward, Sir William (Woolwich. W.)


Gresham Cooke, R.
McLaughlin, Mrs. P.
Stoddart-Scott, Col. Sir Malcolm


Grimond, J.
Maitland, Cdr.J. F. W. (Horncastle)
Studholme, Sir Henry


Grosvenor, Lt.-Col. R. G.
Markham, Major Sir Frank
Summers, Sir Spencer


Gurden, Harold
Marlowe, A. A. H.
Taylor, Sir Charles (Eastbourne)


Hall, John (Wycombe)
Marples, Rt. Hon. A. E.
Taylor, William (Bradford, N.)


Hare, Rt. Hon. J. H.
Marshall, Douglas
Teeling, W.


Harris, Reader (Heston)
Mathew, R.
Temple, John M.


Harrison, A. B. C. (Maldon)
Mawby, R. L.
Thomas, Leslie (Canterbury)


Harrison, Col. J. H. (Eye)
Maydon, Lt.-Comdr. S. L. C.
Thorneycroft, Rt. Hon. P.


Harvey, John (Walthamstow, E.)
Medlicott, Sir Frank
Turner, H. F. L.


Heald, Rt. Hon. Sir Lionel
Molson, Rt. Hon. Hugh
Turton, Rt. Hon. R. H.


Heath, Rt. Hon. E. R. G.
Morrison, John (Salisbury)
Tweedsmuir, Lady


Henderson Stewart, Sir James
Mott-Radclyffe, Sir Charles
Vane, W. M. F.


Hicks-Beach, Mar. W. W.
Nairn, D. L. S.
Vaughan-Morgan, J. K.


Hill, Mrs. E. (Wythenshawe)
Neave, Airey
Vickers, Miss Joan


Hill, John (S. Norfolk)
Nicholson, Sir Godfrey (Farnham)
Vosper, Rt. Hon. D. F.


Hinchingbrooke, Viscount
Nicolson, N.(B'n'm'th, E. &amp; Chr'ch)
Wade, D. W.


Hirst, Geoffrey
Noble, Michael (Argyll)
Wakefield, Edward (Derbyshire, W.)


Holland-Martin, C. J.
Nugent, Richard
Walker-Smith, Rt. Hon. Derek


Holt, A. F.
Oakshott, H. D.
Wall, Patrick


Hornby, R. P.
Ormsby-Gore, Rt. Hon. W. D.
Ward, Rt. Hon. G. R. (Worcester)


Horobln, Sir Ian
Osborne, C.
Ward, Dame Irene (Tynemouth)


Horsbrugh, Rt. Hon. Dame Florence
Page, R. G.
Watkinson, Rt. Hon. Harold


Howard, John (Test)
Partridge, E.
Webbe, Sir H.


Hughes Hallett, Vice-Admiral J.
Peel, W. J.
Webster, David


Hughes-Young, M. H. C.
Peyton, J. W. W.
Whltelaw, W. S. I.


Hurd, Sir Anthony
Pickthorn, Sir Kenneth
Williams, Paul (Sunderland, S.)


Hutchison, Michael Clark(E'b'gh, S.)
Pike, Miss Mervyn
Williams, R. Dudley (Exeter)


Hyde, Montgomery
Pilkington, Capt. R. A.
Wills, Sir Gerald (Bridgwater)


Hylton-Foster, Rt. Hon. Sir Henry
Pitman, I. J.
Wilson, Geoffrey (Truro)


lremonger, T. L.
Pott, H. P.
Woollam, John Victor


Jenkins, Robert (Dulwich)
Powell, J. Enoch



Jennings, Sir Roland (Hallam)
Price, David (Eastleigh)



Johnson, Eric (Blackley)
Price, Henry (Lewisham, W.)
TELLERS FOR THE NOES:


Keegan, D.
Prior-Palmer, Brig. O. L.
Mr. Bryan and


Kerby, Capt. H. B.
Ramsden, J. E.
Mr. Chichester-Clark.

Amendment proposed: In page 14, line 27, at end insert:

(4) In sections two hundred and fourteen and two hundred and fifteen of the Income Tax Act, 1952 (which refer respectively to a person taking charge of widower's or widow's children or acting as his or her housekeeper, and to a relative taking charge of an unmarried person's young brother or sister), for the

references to sixty pounds (which indicate the amount of the relief in each case) there shall be substituted references to seventy-five pounds.—(Mr. H. Wilson.)

Question put, That those words be there inserted:—

The Committee divided: Ayes 175, Noes 213.

Division No. 111.]
AYES
[7.22 p.m.


Alnsley, J. W.
Brockway, A. F.
Craddock, George (Bradford, S.)


Albu, A. H.
Broughton, Dr. A. D. D.
Cronin, J. D.


Allaun, Frank (Salford, E.)
Brown, Rt. Hon. George (Belper)
Grossman, R. H. S.


Allen, Arthur (Bosworth)
Brown, Thomas (Ince)
Davies, Ernest (Enfield, E.)


Allen, Scholefteld (Crewe)
Burke, W. A,
Davies, Harold (Leek)


Awbery, S. S.
Burton, Miss F. E.
Davies, Stephen (Merthyr)


Bacon, Miss Alice
Butler, Herbert (Hackney, C.)
Deer, G.


Bence, C. R. (Dunbartonshire, E.)
Carmichael, J.
Delargy, H. J.


Benson, Sir George
Castle, Mrs. B. A.
Diamond, John


Blackburn, F.
Champion, A. J.
Ede, Rt. Hon. J. C.


Blenkinsop, A.
Chapman, W. D.
Edelman, M.


Blyton, W. R.
Chetwynd, G. R.
Edwards, Rt. Hn. John (Brighouse)


Boardman, H.
Cliffe, Michael
Edwards, Rt. Hn. Ness (Caerphilly)


Bottomley, Rt. Hon. A. G.
Coldrick, W.
Edwards, W. J. (Stepney)


Bowden, H. W. (Leicester, S W)
Collick, P. H. (Birkenhead)
Evans, Albert (Islington, S.W.)


Bowles, F. G.
Corbel, Mrs. Freda
Fernyhough, E.




Fletcher, Eric
Lee, Miss Jennie (Cannock)
Reynolds, G. W.


Forman, J. C.
Lindgren, G. S.
Rhodes, H.


Fraser, Thomas (Hamilton)
Lipton, Marcus
Roberts, Goronwy (Caernarvon)


Gibson, C. W.
Mahon, Dr. J. Dickson
Robinson, Kenneth (St. Pancras, N.)


Gooch, E. G.
McAlister, Mrs. Mary
Rogers, George (Kensington, N.)


Greenwood, Anthony
McInnes, J.
Ross, William


Grenfell, Rt. Hon. D. R.
McKay, John (Wallsend)
Hoyle, C.


Grey, C. F.
MoLeavy, Frank
Short, E. W.


Griffiths, David (Rother Valley)
MacPherson, Malcolm (Stirling)
Silverman, Julius (Aston)


Griffiths, Fit. Hon. James (Lianelly)
Mahon, Simon
Silverman, Sydney (Nelson)


Griffiths, William (Exchange)
Mann, Mrs. Jean.
Simmons, C. J. (Brierley Hill)


Hale, Leslie
Marquand, Rt. Hon. H. A.
Slater, J. (Sedgefield)


Hall, Rt. Hn. Glenvil (Colne Valley)
Mason, Roy
Smith, Ellis (Stoke, S.)


Hamilton, W. W.
Mayhew, C. P.
Snow, J. W.


Hannan, W.
Monslow, W.
Sorensen, R. W.


Hastings, S.
Moody, A. S.
Spriggs, Leslie


Hayman, F. H.
Morris, Percy (Swansea, W.)
Stones, W. (Consett)


Healoy, Denis
Mort, D. L.
Strauss, Rt. Hon. George (Vauxhall)


Henderson, Rt. Hn. A. (Rwly Regis)
Moss, R.
Summerskill, Rt. Hon. E.


Herbison, Miss M.
Moyle, A.
Sylvester, G. O.


Hewitson, Capt. M.
Mulley, F. W.
Taylor, Bernard (Mansfield)


Hobson, C. R. (Keighley)
O'Brien, Sir Thomas
Taylor, John (West Lothian)


Holman, P.
Oliver, G. H.
Thomas, Iorwerth (Rhondda, W.)


Houghton, Douglas
Oram, A. E.
Thomson, George (Dundee, E.)


Hughes, Cledwyn (Anglesey)
Orbach, M.
Thornton, E.


Hughes, Emrys (S. Ayrshire)
Oswald, T.
Tomney, F.


Hughes, Hector (Aberdeen, N.)
Owen, W. J.
Viant, S. P.


Hunter, A. E.
Padley, W. E.
Watkins, T. E.


Hynd, H. (Acorington)
Palmer, A. M. F.
Weitzman, D.


Hynd, J. B. (Attercliffe)
Parker, J.
Wells, William (Walsall, N.)


Irving, Sydney (Dartford)
Paton, John
Wheeldon, W. E.


dancer, B.
Pearson, A.
White, Henry (Derbyshire, N.E.)


Jay, Rt. Hon. D. P. T.
Peart, T. F.
Wilkins, W. A.


Jeger, George (Goole)
Pentland, N.
Willey, Frederick


Jager, Mrs. Lena(Holbn &amp; St. Pncs, S.)
Plummer, Sir Leslie
Williams, Rt. Hon. T. (Don Valley)


Jones, R t. Hon. A. Creech (Wakefield)
Popplewell, E.
Willis, Eustace (Edinburgh, E.)


Jones, Jack (Rotherham)
Prentice, R. E.
Wilson, Rt. Hon. Harold (Huyton)


Jones, J. ldwal (Wrexham)
Probert, A. R.
Winterbottom, Richard


Kenyon, C.
Pursey, Cmdr. H.
Woof, R. E.


Key, Rt. Hon. C. W.
Rankin, John
Yates, V. (Ladywood)


King, Dr. H. M.
Redhead, E. C.
Zilliacus, K.


Lawson, G. M.
Reeves, J.
TELLERS FOR THE AYES:


Lee, Frederick (Newton)
Reid, William
Mr. Holmes and Mr. J. T. Price




NOES


Agnew, Sir Peter
Conant, Maj. Sir Roger
Gresham Cooke, R.


Aitken, W. T.
Cooke, Robert
Grimond, J.


Amory, Fit. Hn. Heathcoat (Tiverton)
Cordeaux, Lt.-Col. J. K.
Grosvenor, Lt.-Col. R. G.


Anstruther-Gray, Major Sir William
Corfield, F. V.
Gurden, Harold


Arbuthnot, John
Craddock, Beresford (Speithorne)
Hall, John (Wycombe)


Armstrong, C. W.
Crosthwalte-Eyre, Col. O. E.
Hare, Rt. Hon. J. H.


Ashton, H.
Crowder, Sir John (Finohley)
Harris, Reader (Heston)


Atkins, H. E.
Cunningham, Knox
Harrison, A. B. C. (Maldon)


Baldock, Lt.-Cmdr. J. M.
Dance, J. C. G.
Harrison, Col. J. H. (Eye)


Baldwin, Sir Archer
Davidson, Viscountess
Harvey, John (Walthamstow, E.)


Barber, Anthony
Davies, Rt. Hn. Clement(Montgomery)
Heald, Rt. Hon. Sir Lionel


Barlow, Sir John
D'Avigdor-Goldsmid, Sir Henry
Heath, Rt. Hon. E. R. G.


Barter, John
de Ferranti, Basil
Henderson-Stewart, Sir James


Batsford, Brian
Doughty, C. J. A.
Hicks-Beach, Maj. W. W.


Beamish, Col. Tufton
du Cann, E. D. L.
Hill, Mrs. E. (Wythenshawe)


Bell, Philip (Bolton, E.)
Dugdale, Rt. Hn. Sir T.(Richmond)
Hill, John (S. Norfolk)


Bevins, J. R. (Toxteth)
Duncan, Sir James
Hirst, Geoffrey


Biggs-Davison, J. A.
Eden, J. B. (Bournemouth, West)
Holland-Martin, C. J.


Bingham, R. M.
Elliott, R. W.(Ne'castleuponTyne, N.)
Holt, A. F.


Birch, Rt. Hon. Nigel
Emmet, Hon. Mrs. Evelyn
Hornby, R. P.


Bishop, F. P.
Errington, Sir Eric
Horsbrugh, Rt. Hon. Dame Florence


Black, Sir Cyril
Erroll, F. J.
Howard, John (Test)


Body, R. F.
Fell, A.
Hughes Hallett, Vice-Admiral J.


Bowen, E. R. (Cardigan)
Fisher, Nigel
Hughes-Young, M. H. C.


Boyd-Carpenter, Rt. Hon. J. A.
Fletcher-Cooke, C.
Hurd, Sir Anthony


Boyle, Sir Edward
Fort, R.
Hutchison Michael Clark (E'b'gh, S.)


Braine, B. R.
Freeth, Denzil
Hylton-Foster, Rt. Hon. Sir Harry


Brewis, John
Galbraith, Hon. T. G. D.
Iremonger, T. L.


Browne, J. Nixon (Cralgton)
Gimmans, Lady
Jenkins, Robert (Dulwich)


Bryan, P.
George, J. C. (Pollok)
Jennings, Sir Roland (Hallam)


Burden, F. F. A.
Glover, D.
Johnson, Eric (Blackley)


Butler, Fit. Hn. R. A. (Saffron Walden)
Glyn, Col. Richard H.
Keegan, D.


Campbell, Sir David
Godber, J. B.
Kerby, Capt. H. B.


Carr, Robert
Goodhart, Philip
Kerr, Sir Hamilton


Cary, Sir Robert
Gough, C. F. H.
Kirk, P. M.


Channon, H. P. G.
Gower, H. R.
Lambton, Viscount


Chichester-Clark, R.
Graham, Sir Fergus
Lancaster, Col. C. G.


Clarke, Brig. Terence (Portsmth, W.)
Grant, Rt. Hon. W. (Woodside)
Langford-Holt, J. A.


Cole, Norman
Green, A.
Leavey, J. A.







Legge-Bourke, Maj. E. A. H.
Osborne, C.
Studholme, Sir Henry


Legh, Hon. Peter (Petersfield)
Page, R. G.
Summers, Sir Spencer


Lindsay, Hon. James (Devon, N.)
Partridge, E.
Taylor, Sir Charles (Eastbourne)


Lindsay, Martin (Solihull)
Peel, W. J.
Taylor, William (Bradford, N.)


LInstead, Sir H. N.
Peyton, J. W. W.
Teeling, W.


Lloyd, Maj. Sir Guy (Renfrew, E.)
Piokthorn, Sir Kenneth
Temple, John M.


Longden, Gilbert
Pike, Miss Mervyn
Thomas, Leslie (Canterbury)


Levey', Walter H.
Pilkington, Capt. R. A.
Thorneycroft, Rt. Hon. P.


Lucas, P. B. (Brantford &amp; Chiswick)
Pitman, I. J.
Turner, H. F. L.


Lucas-Tooth, Sir Hugh
Pott, H. P.
Turton, Rt. Hon. R. H.


Macdonald, Sir Peter
Powell, J. Enoch
Tweedsmuir, Lady


McLaughlin, Mrs. P.
Price, David (Eastleigh)
Vane, W. M. F.


Maitland, Cdr. J. F. W. (Hornoastle)
Price, Henry (Lewisham, W.)
Vaughan-Morgan, J. K.


Maitland, Hon. Patrick (Lanark)
Prior-Palmer, Brig. 0. L.
Vickers, Miss Joan


Markham, Major Sir Frank
Rarnsden, J. E.
Vosper, Rt. Hon. D. F.


Marlowe, A. A. H.
Redmayne, M.
Wade, D. W.


Marples, Rt. Hon. A. E.
Rees-Davies, W. R.
Wakefield, Edward (Derbyshire, W.)


Marshall, Douglas
Remnant, Hon. P.
Walker-Smith, Rt. Hon. Derek



Mathew, R.
Ridsdale, J. E.
Wall, Patrick


Mawby, R. L.
Robinson, Sir Roland (Blackpool, S.)
Ward, Rt. Hon. G. R. (Worcester)


Maydon, Lt.-Comdr, S. L. C.
Roper, Sir Harold
Ward, Dame Irene (Tynemouth)


Medlioott, Sir Frank
Ropner, Col. Sir Leonard
Watkinson, Rt. Hon. Harold


Wilson, Rt. Hon. Hugh
Russell, R. S.
Webbe, Sir H.


Morrison, John (Salisbury)
Sharpies, R. C.
Webster, David


Mott. Radclyffe, Sir Charles
Shepherd, William
Whitelaw, W. S. I.


Nairn, D. L. S.
Simon, J. E. S. (Middlesbrough, W.)
Williams, Paul (Sunderland, S.)


Heave, Airey
Spearman, Sir Alexander
Williams, R. Dudley (Exeter)


Nicholson, Sir Godfrey (Farnham)
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)
Wills, Sir Gerald (Bridgwater)


Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Stanley, Capt. Hon. Richard
Wilson, Geoffrey (Truro)


Noble, Michael (Argyll)
Stevens, Geoffrey
Wooilam, John Victor


Nugent, Richard
Steward, Harold (Stockport, S.)
TELLERS FOR THE NOES:


Oakshott, H. D.
Steward, Sir William (Woolwich, W.)
Mr. Brooman-White and


Ormsby-Gore, Rt. Hon. W. D.
Stoddart-Scott, Col. Sir Malcolm
Mr. Finlay.

Mr. Houghton: I beg to move, in page 14, line 28, to leave out from "In" to "section".
I think that it might be for the convenience of the Committee if we considered with this Amendment the Amendments in page 14, line 29, after "1952", insert:
(Relief for small incomes), references to three hundred and fifty pounds shall be substituted in all those places for references to three hundred pounds (the income limit for the full relief)";
and in page 14, line 30, leave out "five" and insert "fifty".
I wish to apologise to the Financial Secretary for the clumsy reference which I made to him a few moments ago. I do that now because I have a feeling that before I finish speaking on this Amendment I shall be really angry with him.

Mr. Simon: I would say, before the hon. Gentleman gets really angry, that it was very kind of him to apologise, but it was quite unnecessary because it was perfectly obvious that it was a slip and and I certainly took no offence, as I think he knows.

Mr. Houghton: We are taking our last stand on the Amendments to this Clause. This is a small yet important Amendment which, if the debate last year is anything to go by, would cost very little. In the OFFICIAL REPORT of 17th June, 1958, the hon. and learned Member said that the

cost of this Amendment, which is exactly the same as the one moved a year ago, would be £750,000, which he added,
…is a substantial sum."—[OFFICIAL REPORT, 17th June, 1958; Vol 589, c. 932.]
In the context of this debate it is the merest chicken feed, and with the reinforcement, which I hope I see on the benches opposite, including that of the hon. Lady the Member for Tynemouth (Dame Irene Ward), I hope that we can wring some concession from the Financial Secretary at the end of this debate.
The purpose of the Amendment is to lift the limit of incomes for small incomes relief from £300 to £350. Small incomes relief provides that where a person not qualifying for age exemption or relief has a total income not exceeding £300, the benefit of, the two-ninths earned income relief shall be granted on unearned income. This relief was first introduced in 1952. The limit of income was then £250. It was raised to £300 in 1955 and has remained at that figure ever since.
This relief was introduced, if I remember rightly, by the Lord Privy Seal. It was designed to give some relief to people living on small fixed incomes, widows receiving annuities, maiden ladies who had been left modest incomes by their parents, and those who had been compelled prematurely to retire on health grounds and were unable to take up any other occupation. These were the people


who were compelled to live on small fixed incomes but who were not old enough to qualify either for age exemption or for age relief.
As the Committee knows, exemption is granted to a person at 65 years and over where the total income from all sources is not more than £275, and, in the case of a married couple, if either of them is over 65, where the total income from all sources is not more than £440. That is age exemption. That is total exemption from tax if their total incomes are within the limits that I have mentioned.
Then there is age relief which enables a taxpayer over 65 or a married couple one of whom is over 65 to get the benefit of the two-ninths earned income relief on unearned income if the total income is not more than £800 a year. There are escalator provisions for marginal relief. Those who claim small incomes relief are outside the scope of either age exemption or age relief. It is noticeable that the income ceiling for small incomes relief has not moved upwards in sympathy with the upward movement of both the age exemption and age relief. It seems that the time has come when this income ceiling should be placed a little higher, and our proposal of an uplift of £50 is very modest indeed.
I emphasise again that in these cases it is not a question of granting exemption from tax. It is only that the benefit of earned income relief is given on income which otherwise would be treated as unearned income—annuities, interest from banks and other modest dividends which these people receive. When the Lord Privy Seal introduced this relief, I think that he did so with the general assent of the House and with the sympathy of everyone who heard his plea for those who were perhaps the worst victims of inflation, the fall in the value of money—those who had no means of protecting themselves from the fall in the purchasing power of their modest incomes.
I had the honour to move a similar Amendment last year. The Financial Secretary replied to that debate in very pleasant terms, as he always does. No hon. Member rejects so much in such a charming way. I should not mind on this occasion if he were a little short and gruff if at the end be conceded what the Amendment asks.
Looking at the OFFICIAL REPORT of a year ago I see that the Financial Secretary said:
By this Amendment we would not be helping people in the very poorest circumstances. No one with an income of under £300 would be helped. It is primarily those with incomes between £300 and £350, and to a lesser extent in the band who get marginal relief running up to £397, as in the case of a single man with purely investment income."—[OFFICIAL REPORT, 17th June, 1958; Vol. 589, c. 932–3.]
Here again we have the old problem of how to give relief to the poorest without giving some relief to those who are not quite so poor, but I stress that in this case the ceiling was lifted to £300 in 1955 and, unless I am very much mistaken, there was an increase in the ceiling of income for age relief given only last year. I am not sure whether at the same time an improvement was made in the age exemption but I believe it was. I have so many notes at my side that it is not always easy to find the correct note on the spur of the moment.
The Committee must bear in mind that the companion reliefs of age exemption and age relief have both been moved upwards. The age relief ceiling has been moved upwards twice, first to £700 and then to £800, without any change in the ceiling for small incomes relief. I sincerely hope, therefore, that the Financial Secretary will make the concession today. My right hon. Friend the Member for Huyton (Mr. H. Wilson) draws my attention to the fact that the increase in the age exemption ceiling for a single person last year was from £250 to £275.
Even at this time in the debate our imaginations are still lively enough for us to picture in our minds the plight of these people. They have had a wonderful champion in the hon. Lady the Member for Tynemouth. Other hon. Members have championed this cause, but she has done so especially, and she has done it with courage, with great determination, and sometimes with ruthlessness. I look forward to hearing what she says about the Amendment.
If it is conceded, I will grant that there is no party capital to be claimed for it. It is a responsibility on the Committee as a whole. It is a small enough thing to ask. This is the final Amendment on the Clause. Other reliefs have been improved. Last year the Financial Secretary said that this relief could not be


considered in isolation. Of course, nothing can be considered in isolation in matters of this kind, but there are times when it is right and proper to distinguish one relief from another, as indeed the Chancellor has at times distinguished between this and other reliefs. I, therefore, hope that the Financial Secretary will tell us that his right hon. Friend has authorised him to make the concession.

7.45 p.m.

Dame Irene Ward: I always feel that I want to respond to the hon. Member for Sowerby (Mr. Houghton), but I must be very quick on this occasion because we have had a long debate on the Amendments. I feel that I have been rather restrained in the debate, because I thought that many of the claims were very reasonable, and it was only the general pattern of my right hon. Friend's Budget which prevented me from arguing in support of some of them. I think that my hon. and learned Friend the Financial Secretary is well aware how much I should welcome this concession.

Mr. Sydney Silverman: The hon. Lady could show that in the Division Lobby.

Dame Irene Ward: There is no point in talking about what will happen in the Division Lobby. The hon. Member has stimulated me to say that I noticed the generosity of the hon. Member for Sowerby in that he made it plain from the beginning that the concessions which have been given in favour of what I call the small fixed income groups started with a Conservative Chancellor of the Exchequer, and year by year we have increased those concessions. For that I am grateful.

Mr. Silverman: If the hon. Lady will permit me, I will intervene only so far as to say that my muttered interjection was not meant in any unkindly sense. She said that her hon. and learned Friend knew how much she was in revolt. It occurred to me that if she wanted him to know how much she was in revolt, the Division Lobby was the place for him to find out.

Dame Irene Ward: I am grateful to the hon. Member for that intervention, although, if I may say so, I do not think that my answer is in conflict with his

mutterings. His muttering was directed towards suggesting that I might go into the Division Lobby with the Labour Party. It has only made the point a little clearer and wasted a little more time.
As I was saying, the hon. Member for Sowerby made it clear that all the concessions in respect of the small fixed income groups within the range of the argument have been made by the Conservative Party. I cannot describe myself as an importunate widow and nobody has ever described me as an importunate spinster, but I must tell my hon. and learned Friend that it would give a great many of my hon. Friends and myself great pleasure if this concession were made. I recognise, however, that from time to time I have to allow other people to have a few benefits and that, certainly in political and national life, one cannot be unduly selfish.
In considering the situation of these people whose case I try to put and whom I try to cherish—because there are so few interested in speaking for them—I would say that if I had to choose between what has been done for them by the Labour Party and what has been done for them by my party, I should unhesitatingly choose my party, because even if we do not get the concession today we may get it in the next Budget.

Mr. H. Hynd: Under a Labour Government.

Dame Irene Ward: After long experience of the House of Commons, I have learned that although one does not always win the battle straight away, the time generally comes when one does win it. May I add that I am grateful for the references which the hon. Member for Sowerby made to me?
I hope that we shall have a favourable reply to the Amendment. If we do not, I still back my own party, because I know that under our political philosophy these people in whom I am deeply interested are much more likely to benefit than they are under the administration of the Labour Party. That is all I have to say. I hope that my hon. and learned Friend will be nice and give us this concession.

Mr. Ede: My right hon. and hon. Friends and myself were very disappointed when we were told that the last Amendment would cost too much. We were told


last year that the suggestion contained in the present Amendment would have cost about £750,000. I suggest to the hon. and learned Gentleman that he has given about £750,000 away to the brewers and that on Report he should remove Clause 5 from the Bill. Then these people could have the very small remission for which my hon. Friend the Member for Sowerby (Mr. Houghton) has asked.
A secret message appears to have passed between the brewers and the Treasury. No one had heard that the brewers wanted this money. When he had to defend the position, the Economic Secretary said that the brewers had asked for it. Everyone knows that when the party opposite is in power a mere whisper from the brewers has the most tremendous effect forthwith. The first thing that the Tory Party did when it was returned to power was to give the brewers freedom.
I suggest to the hon. and learned Gentleman that he should explain to the brewers that he wants this £750,000 to devote to these people in very impecunious circumstances. Whenever the brewers reach the same circumstances, they can rest assured that the hon. and learned Gentleman will not turn a deaf ear to any pleas which they may make. There is no trouble this time about the money. The question is the willingness to recognise where relief is needed most.

Mr. Simon: If the right hon. Member for South Shields (Mr. Ede) will forgive me, I do not think that I will follow him in discussing the position of brewers in relation to this Amendment, except that when I deal with the cost of it I must say that the right hon. Gentleman is under a misapprehension in thinking that there has been any remission of tax, either of £5 million or £750,000, to the brewers. I think that that was pointed out—I was not here—in the debate on Clause 5, dealing with the monopoly value.
It must not be thought that there is a fund out of which this £750,000, which the Amendment would cost, can be readily found. Nevertheless, it must be obvious to the Committee that, although £750,000 is a substantial sum and not one of which one should talk lightly, the cost in this case cannot be in any way the conclusive argument.
If I am bound to advise the Committee to reject the Amendment, as I feel I am, the argument is quite another one. If I have to reject the appeal made by the hon. Member for Sowerby (Mr. Houghton) and that of my hon. Friend the Member for Tynemouth (Dame Irene Ward), who has been such a valiant and active spokesman for the sort of people who would be the beneficiaries under this Amendment, I am conscious that the arguments I make on the other side are arid ones related to the shape of the fiscal system. Nor do I for a moment minimise the force and relevance of the arguments which the hon. Members advanced.
The Amendment would help those persons under 65 years of age whose income is between £300 and £350. Undoubtedly, a substantial number of those persons are in difficult circumstances. I am thinking of widows and persons who have had to retire prematurely through ill-health, and so on, living on small investment incomes. On the other hand, it is only right to recognise that in this group are many others who are not in those circumstances. One example is a young person just starting out on his ordinary career who has a small investment income, for example, something he has inherited or which has been bequeathed to him. Although the group who would benefit undoubtedly includes some needy people who could well do with the assistance, it is not a group consisting of the most needy, because the most needy earn under £300 and have been the beneficiaries of this relief in the past since its institution in 1952 and its increase in 1955. Nor are they necessarily exclusively people of the class which the hon. Member for Sowerby and my hon. Friend very rightly have in mind.
The hon. Member for Sowerby reminded us that this relief was instituted in 1952. Without making any sort of party point, I think that the reasons given by my hon. Friend are valid. The relief was raised in 1955 from £250 to £300 because of the increase in the personal allowances in that year. Of all the allowances, this is essentially the one which should go with the personal allowances.
The reason why it was raised in 1955 was that the raising of the personal allowances in 1955 meant that £309 of the income of a married couple became exempt. Under those circumstances, there


was a clear case for raising this relief from £250 to £300. The married person's relief is till £240, so that the exemption point is still £309. Therefore, it would create an anomaly to raise this relief to £350 as proposed by the Amendment.
I am conscious that that is an arid argument compared with the considerations advanced by the hon. Member for Sowerby and my hon. Friend. Nevertheless, it is a valid argument and it is one that should compel the Committee to vote against the Amendment. I could not help calling to mind the illiterate film star who thought that letters "y-e-s" spelt "Mink" and I could not help thinking that there is very little mink in the life of a Financial Secretary. He spends most of the time saying "No". He says "No" to his colleagues and, unfortunately, "No" to the Committee, however agreeably Amendments are moved.
It is my duty, once again, to advise the Committee to reject the Amendment. We all look forward to the time when this relief can be increased at the same time as the personal allowances can be improved. Nor is there any reason, if things continue as they have in these past years, why that should not happen. I am bound to tell the Committee that, as by a recent vote of the Committee the personal allowances remain the same, this is not the time to accept the Amendment.

8.0 p.m.

Mr. Houghton: That reply is very disappointing. I am grateful to the hon. Member for Tynemouth (Dame Irene Ward) for her contribution to the debate. Everyone will understand if she feels unable to support the Amendment in the Lobby. We fully understand that overtures made from time to time from one side of the Committee to another to enter the opposing Lobby are rarely responded to, because we do not do business in that way. No one will accuse the hon. Lady of lacking in courage. At present, she is fairly content, I think, with the Budget and all its works and will be prepared to leave this battle to be fought another day. I am sorry about that. I had hoped that she would feel rather strongly about it now.
The Financial Secretary began, I thought, by almost destroying the basis upon which the relief was introduced.

When the relief was introduced in 1952 it applied then, as it does today, to what, I imagine, are the comparatively rare cases where a relatively young person starting out on life's work has unearned income, and whose total income will still be below the ceiling applicable to this relief.
It could happen, probably almost momentarily, before such a person had entered full earning capacity, but had the Lord Privy Seal, when Chancellor, felt that it was desirable or necessary to protect the relief from that sort of case he would not have had any difficulty in introducing some qualification to that end. He did not. I should imagine that he thought that, as the number of cases would be so small, it was not worth bothering about. Therefore, the hon. and learned Gentleman should not undermine, as he did, the basis upon which the relief was first introduced by general assent of the Committee and of the House.
The relationship between one set of personal reliefs and another is, admittedly, always a difficulty. "When father says turn, we all turn "—but, until he does, no one can turn at all, because everything must depend on something else. That seems to be the mischief of a good deal of this legislation. It seems impossible for the Committee to make a small concession or remedy a relatively small grievance without stringing the thing out over the whole field of personal reliefs. And then the Financial Secretary says," Oh, this is hopeless. To meet a comprehensive demand would entail the loss of far too much revenue." So we go round in circles.
What the Financial Secretary has done has been to refer us back to the matters that we were discussing earlier—and to some matters that we have not raised at all—as reasons for his not being able to move on this small relief without introducing anomalies. Sometimes, it is worth while saying, "To the devil with anomalies." They are not all that sacred; they are not all that sancrosanct. On occasion, one can make a relief without following it logically into other ranges of relief and taxation.
It is, of course, easier to distinguish between concessions given to old age and the normal liability to tax of a person who is not old. If differences between the


tax liability of old people and not so old people were today regarded as anomalies, some adjustments would not have been made either in age relief or age exemption—and particularly in age exemption, because the income of the married couple which is completely exempt from tax under age exemption is not exempt in the hands of a married couple one of whom is not 65. That has been justified on the grounds of a concession to old age.
This concession would be made largely—I should say predominantly—to persons in indifferent health, in difficult circumstances, who are having to make do on very inadequate resources—the kind of genteel poverty that is so distressing to witness. These are the people who have been used to comforts and to a standard of life somewhat higher—in many cases, much higher—than they are now able to enjoy.
They are a class apart. They are not part of the earning community. They are not found among those who can supplement their investment income by earnings. Many of them will be between 60 and 65—over the pension age for women—but will not qualify for age exemption until both reach the age of 65. All these conciderations would be reliefs were this Amendment accepted.

I shall not get angry, I am only very disappointed that the hon. and learned Gentleman has not been able to meet us in the last of a long string of Amendments. I sometimes wonder what is the meaning of the term "parliamentary government". One goes through these processes hour by hour and day by day, but rarely ever can the House or Committee make its will effective. 1 am sure that if it were left to hon. Members on both sides, who had listened to the debate, to decide whether or not this small concession should be given, we should, without doubt, get it.

But the customary discipline is imposed on right hon. and hon. Gentlemen opposite, and none can break away from it—on either side, so it seems—to assert Parliament's predominant will and power to give this concession to some of the helpless members of our community. As long as we endure this in the name of parliamentary government it is a challenge to our system, to our honesty and to our courage, and we have to defend it before the people whom we ask to believe in parliamentary government.

Question put, That the words proposed to be left out stand part of the Clause:

The Committee divided: Ayes 212. Noes 177.

Division No. 112.]
AYES
[8.10 p.m.


Agnew, Sir Peter
Cary, Sir Robert
Glyn, Col. Richard H.


Aitken, W. T.
Channon, H. P. G.
GOdber, J. B.


Amory, Rt. Hn. Heathcoat (Tiverton)
Clarke, Brig. Terence (Portsmth, W.)
Goodhart, Philip


Anstruther-Gray, Major Sir William
Conant, Maj. Sir Roger
Gough, C. F. H.


Arbuthnot, John
Cooke, Robert
Gower, H. R.


Armstrong, C. W.
Cordeaux, Lt.-Col. J. K.
Graham, Sir Fergus


Ashton, H.
Garfield, F. V.
Grant, Rt. Hon. W. (Woodside)


Atkins, H. E.
Craddock, Beresford (Spelthorne)
Green, A.


Baldock, Lt.-Cmdr. J. M.
Crosthwaite-Eyre, Col. 0. E.
Gresham Cooke, R.


Baldwin, Sir Archer
Crowder, Sir John (Finchley)
Grimond, J.


Barber, Anthony
Cunningham, Knox
Gurden, Harold


Barlow, Sir John
Dance, J. C. G.
Hall, John (Wycombe)


Barter, John
Davidson, Viscountess
Harris, Reader (Heston)


Batsford, Brian
D'Avigdor-Goldsmid, Sir Henry
Harrison, A. B. C. (Maldon)


Beamish, Col. Tufton
de Ferranti, Basil
Harrison, Col. J. H. (Eye)


Bovine, J. R. (Toxteth)
Doughty, C. J. A.
Harvey, SirArthur Vere (Macclesf'd)


Biggs-Davison, J. A.
du Cann, E. D. L.
Harvey, John (Walthamstow, E.)


Bingham, R. M.
Dugdale, Rt. Hn. Sir T. (Richmond)
Heald, Rt. Hon. Sir Lionel


Bishop, F. P.
Duncan, Sir James
Heath, Rt. Hon. E. R. G.


Black, Sir Cyril
Eden, J. B. (Bournemouth, West)
Henderson, John (Cathcart)


Body, R. F.
Eillott, R.W.(Ne'castle upon Tyne.N.)
Henderson-Stewart, Sir James


Bonham Carter, Mark
Emmet, Hon. Mrs. Evelyn
Hicks-Beach, Maj. W. W.


Bowen, E. R. (Cardigan)
Errington, Sir Eric
Hill, Mrs. E. (Wythenehawe)


Boyd-Carpenter, Rt. Hon. J. A.
Erroll, F. J.
Hirst, Geoffrey


Boyle, Sir Edward
Fell, A.
Holland-Martin, C. J.


Braine, B. R.
Finlay, Graeme
Holt, A. F.


Brewis, John
Fisher, Nigel
Hornhy, R. P.


Bromley-Davenport, Lt.-Col. W. H.
Fletcher-Cooke, C.
Horsbrugh, Rt. Hon. Dame Florence


Brooman-White, R. C.
Fort, R.
Howard, Hon. Greville (St. Ives)


Bryan, P.
Freeth, Denzil
Howard, John (Test)


Burden, F. F. A.
Galbraith, Hon. T. G. D.
Hughes Hallett, Vice-Admiral J.


Butler, Rt. Hn.R.A.(Saffron Walden)
Gammans, Lady
Hughes-Young, M. H. C.


Campbell, Sir David
George, J. C. (Pollok)
Hurd, Sir Anthony


Carr, Robert
Glover, D.
Hutchison, Michael Clark(E'b'gh, S.)




Hylton-Foster, Rt. Hon. Sir Harry
Neave, Airey
Steward, Harold (Stockport, S.)


Iremonger, T. L.
Nicholson, Sir Godfrey (Farnham)
Steward, Sir William (Woolwich, W.)


Jenkins, Robert (Dulwich)
N icolson, N. (B'n'm'th, E. &amp; Chr'oh)
Stoddart-Scott, Col. Sir Malcolm


Jennings, Sir Roland (Hallam)
Noble, Michael (Argyll)
Studholme, Sir Henry


Johnson, Eric (Blackley)
Nugent, Richard
Summers, Sir Spencer


Keegan, D.
Oakshott, H. D.
Taylor, Sir Charles (Eastbourne)


Kerby, Capt. H. B.
Ormsby-Gore, Rt. Hon. W. D.
Taylor, William (Bradford, N,)


Kerr, Sir Hamilton
Osborne, C.
Teeling, W.


Kirk, P. M.
Page, R. G.
Temple, John M.


Lambton, Viscount
Partridge, E.
Thomas, Leslie (Canterbury)


Lancaster, Col. C. G.
Peel, W. J.
Thompson, R. (Croydon, S.)


Langford-Holt, J. A.
Peyton, J. W. W.
Thorneycroft, Rt. Hon. P.


Leavey, J. A.
Pickthorn, Sir Kenneth
Turner, H. F. L.


Legge-Bourke, Maj. E. A. H.
Pike, Miss Mervyn
Turton, Rt. Hon. R. H.


Legh, Hon. Peter (Petersfield)
Pilkington, Capt. R. A.
Tweedsmuir, Lady


Lindsay, Hon. James (Devon, N.)
Pitman, I. J.
Vane, W. M. F.


Lindsay, Martin (Solihull)
Pitt, Miss E. M.
Vaughan-Morgan, J. K.


Linstead, Sir H. N.
Pott, H. P.
Vickers, Miss Joan


Lloyd, Maj. Sir Guy (Renfrew, E.)
Powell, J. Enoch
Vosper, Rt. Hon. D. F.


Longden, Gilbert
Price, David (Eastleigh)
Wade, D. W.


Loveys, Walter H.
Price, Henry (Lewisham, W.)
Wakefield, Edward (Derbyshire, W.)


Lucas, P. B. (Brentford &amp; Chiswick)
Prior-Palmer, Brig. O. L.
Walker-Smith, Rt. Hon. Derek


Lucas-Tooth, Sir Hugh
Ramsden, J. E.
Wall, Patrick


Macdonald, Sir Peter
Rawlinson, Peter
Ward, Rt. Hon. G. R. (Worcester)


McLaughlin, Mrs. P.
Redmayne, M.
Ward, Dame Irene (Tynemouth)


Maitland, Cdr.J. F. W. (Horncastle)
Rees-Davies, W. R.
Webbe, Sir H.


Maitland, Hon. Patrick (Lanark)
Remnant, Hon. P.
Webster, David


Markham, Major Sir Frank
Ridsdale, J. E.
Whitelaw, W. S. I.


Marlowe, A. A. H.
Roper, Sir Harold
Williams, Paul (Sunderland, S.)


Marples, Rt. Hon. A. E.
Ropner, Col. Sir Leonard
Williams, R. Dudley (Exeter)


Marshall, Douglas
Russell, R. S.
Wills, Sir Gerald (Bridgwater)


Mathew, R.
Sharpies, R. C.
Wilson, Geoffrey (Truro)


Mawby, R. L.
Shepherd, William
Wolrige-Gordon, Patrick


Maydon, Lt.-Comdr. S. L. C.
Simon, J. E. S. (Middlesbrough, W.)
Woollam, John Victor


Medlicott, Sir Frank
Spearman, Sir Alexander



Molson, Rt. Hon. Hugh
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)
TELLERS FOR THE AYES


Mott-Radclyffe, Sir Charles
Stanley, Capt. Hon. Richard
Mr. Cbichester-Clark and


Nairn, D. L. S.
Stevens, Geoffrey
Mr. J. E. B. Hill.




NOES


Ainsley, J. W.
Edwards, Rt. Hon. Ness (Caerphilly)
Kenyon, C.


Albu, A. H.
Edwards, W. J. (Stepney)
Key, Rt. Hon. C. W.


Allaun, Frank (Salford, E.)
Evans, Albert (Islington, S.W.)
King, Dr. H. M.


Allen, Arthur (Bosworth)
Evans. Edward (Lowestoft)
Lawson, G. M.


Allen, Scholefield (Crewe)
Fernyhough, E.
Lee, Frederick (Newton)


Awbery, S. S.
Fletcher, Eric
Lee, Miss Jennie (Cannock)


Bacon, Miss Alice
Forman, J. C.
Lindgren, G. S.


Bence, C. R. (Dunbartonshire, E.)
Fraser, Thomas (Hamilton)
Lipton, Marcus


Benson, Sir George
Gibson, C. W.
Mahon, Dr. J. Dickson


Blackburn, F.
Gooch, E. G.
McAlister, Mrs. Mary


Blenkinsop, A.
Gordon Walker, Rt. Hon. P. C.
McCann, J.


Blyton, W. R.
Greenwood, Anthony
MacGoll, J, E.


Boardman, H.
Grenfell, Rt. Hon. D. R.
McInnes, J.


Bottomley, Rt. Hon. A. G.
Grey, C. F.
McKay, John (Wallsend)


Bowden, H. W. (Leicester, S.W.)
Griffiths, David (Rother Valley)
McLeavy, Frank


Bowles, F. G.
Griffiths, Rt. Hon. James (LianellY)
MacPherson, Malcolm (Stirling)


Braddock, Mrs. Elizabeth
Griffiths, William (Exchange)
Mahon, Simon


Brockway, A. F.
Hale, Leslie
Mann, Mrs. Jean


Broughton, Dr. A. D. D.
Hall, Rt. Hn. Gienvil (Caine Valley)
Marquand, Rt. Hon. H. A.


Brown, Rt. Hon. George (Belper)
Hamilton, W. W.
Mason, Roy


Brown, Thomas (Ince)
Hannan, W.
Mayhew, C. P.


Burke, W. A.
Hastings, S.
Monslow, W.


Burton, Miss F. E.
Hayman, F. H.
Moody, A. S.


Butler, Herbert (Hackney, C.)
Healey, Denis
Morris, Percy (Swansea, W.)


Carmichael, J.
Henderson, Rt. Hn. A. (Rwly Regis)
Mort, D. L.


Castle, Mrs. B. A.
Herbison, Miss M.
Moss, R.


Champion, A. J.
Hewitson, Capt. M.
Moyle, A.


Chapman, W. D.
Hobson, C. R. (Keighley)
Mulley, F. W.


Chetwynd, G. R.
Holman, P.
O'Brien, Sir Thomas


Cliffe, Michael
Houghton, Douglas
Oliver, G. H.


Coldrick, W.
Hughes, Cledwyn (Anglesey)
Oram, A. E.


Collick, P. H. (Birkenhead)
Hughes, Emrys (S. Ayrshire)
Orbach, M.


Corbet, Mrs. Freda
Hughes, Hector (Aberdeen, N.)
Oswald, T.


Craddock, George (Bradford, S.)
Hunter, A. E.
Owen, W. J.


Cronin, J. D.
Hynd, H. (Accrington)
Padley, W. E.


Crossman, R. H. S.
Hynd, J. B. (Attercliffe)
Palmer, A. M. F.


Davies, Harold (Leek)
Irving, Sydney (Dartford)
Parker, J.


Davies, Stephen (Merthyr)
Danner, B.
Paton, John


Deer, G.
Jay, Rt. Hon. D. P. T.
Pearson, A.


Deiargy, H. J.
Jeger, George (Goole)
Peart, T. F.


Diamond. John
Jegar, Mrs. Lena(Holbn &amp; St. Pncs, S.)
Pentland, N.


Ede, Rt. Hon. J. C.
Jones, Rt. Hon. A. Creech (Wakefield)
Plummer, Sir Leslie


Edelman, M.
Jones, Jack (Rotherham)
Prentice, R. E.


Edwards, Rt. Hon. John (Brighouse)
Jones, J. Idwal (Wrexham)
Price, Philips (Gloucestershire, W.)







Probert, A. R.
Skeftington, A. M.
Watkins, T. E.


Ptirsey, Cmdr. H.
Slater, J. (Sedgefield)
Wells, William (Walsall, N.)


RanPin, John
Smith, Ellis (Stoke, S.)
Wheeldon, W. E.


Redhead, E. C.
Snow, J. W.
White, Henry (Derbyshire, N.E.)


Reeves, J.
Sorensen, R. W.
Wilkins, W. A.


Reid. William
Spriggs, Leslie
Willey, Frederick


Reynolds, G. W.
Stones, W. (Consett)
Williams, Rt. Hon. T. (Don Valley)


Rhodes, H.
Summerskill, Rt. Hon. E.
Willis, Eustace (Edinburgh, E.)


Robinson, Kenneth (St. Pancras, N.)
Sylvester, G. O.
Wilson, Rt. Hon. Harold (Huyton)


Rogers, George (Kensington, N.)
Taylor, Bernard (Mansfield)
Winterbottom, Richard


Ross, William
Taylor, John (West Lothian)
Woof, R. E.


Royle, C.
Thomas, lorwerth (Rhondda, W.)
Yates, V. (Ladywood)


Short, E. W.
Thomson, George (Dundee, E.)
Zilliacus, K.


Silverman, Julius (Aston)
Thornton, E.



Silverman, Sydney (Nelson)
Tomney, F.
TELLERS FOR THE NOES:


Simmons, C. J. (Brierley Hill)
Viant, S. P.
Mr. Holmes and Mr. J. T. Price.

Clause, as amended, ordered to stand part of the Bill.

Clause 17.—(RESTORATION OF INVEST MENT ALLOWANCES, AND ADDITIONAL GRANT OF INITIAL ALLOWANCES IN CERTAIN CASES.)

Mr. John Diamond: I beg to move, in page 14, line 48, at the end to insert:
Provided that for the purposes of this section the said subsections (2) to (5) shall have effect as if in subsection (2) and subsection (5) there was substituted the word "one-eighth" for the word "one-tenth" and in subsection (3) and subsection (4) there were substituted the word "one-quarter" for the word "one-fifth".
It might he convenient if I were first to indicate the purpose of the Amendment, then attempt to explain its effect, then deal with the cost, and finally give the reasons why the Government should accept the Amendment. The purpose is to assist the Chancellor in his objective of arresting
…the prospective decline in private investment in the manufacturing sector."—[OFFICIAL REPORT, 7th April, 1959; Vol. 603, c. 58.]
The way to do that, in the view of the Chancellor, is to introduce investment allowances which will, he thinks, give a fillip to increased investment in the private sector.
As the law stands at present, and before the Finance Bill becomes an Act, the position is that there are initial allowances —a method of expediting the allowance given to businesses in respect of plant and similar items. These initial allowances are given for three main categories—industrial and agricultural buildings, new plant and machinery, and mining works. The Chancellor has proposed in this Bill that instead of those initial allowances, there shall be (a) an investment allowance for some part of the plant or buildings

and (b) an initial allowance for the balance.
In the case of industrial buildings, for example, instead of an initial allowance of 15 per cent., there is a reduced initial allowance of only 5 per cent. and the difference of 10 per cent. becomes an investment allowance, and so on throughout these different categories. The effect of what the Chancellor is proposing, quite simply, is to give a more attractive investment allowance in place of initial allowances to some extent. The purpose of the Amendment is to increase the attraction in order to make it a worth-while attraction.
Before one attempts to give reasons one should make an estimate of the cost of what one is proposing. We on this side of the Committee are always in great difficulty in estimating cost. Indeed, if I were to try to put an accurate figure on the cost, with my lack of information, I should probably be thrown out of the institute to which I have the honour to belong.
I have gone into this matter as carefully as I can, and have made appropriate calculations, and, having regard to the fact that the Amendment deals with it on a proportionate basis, I have come to the conclusion that, as the cost of the Chancellor's proposal in the current year is nil, the proportionate increase would also be nil. I think, therefore, that we are on common ground so far. I recognise that for a subsequent year the cost of the Chancellor's proposal would be some £9½ million and it is clear that the cost of these proposals would be perhaps £2 million, perhaps £3 million, more. At all events, we are dealing with a figure which is of no account in the current year and may be a small but not impossible figure to deal with in future years.
May I say why I do not think the Chancellor's proposals are sufficiently attractive? First, the Chancellor's proposal is a negligible one, in my opinion. It is true that an investment allowance is a form of subsidy. As the Committee will well understand, an investment allowance is something that is given in addition to anything else. It is something that is given early and taken back later on. An investment allowance is, therefore, something given in addition by way of bonus or subsidy, or whatever it is likely to be called, to encourage investment of this particular kind.
I say it is a negligible one because, even if we take the highest rate proposed by the Chancellor of 20 per cent., it is not more than sufficient to cover the erosion of inflation. Every director of a company or owner of a business who has to buy plant knows that when he comes to renew it, it costs more than did the plant which he had previously and which has become out of date. If we take an ordinary average case of an item of plant which lasts perhaps ten years, and take the simple figure of 2 per cent. for each year's reduction in the value of money, over a period of ten years we get a figure of 20 per cent. In short, anybody renewing plant which cost £100 would have to pay, in these circumstances, £120, because the cost of the item has become more expensive in the meantime. He pays £120 to get exactly the same piece of plant that he had in his works previously.
Under the proposals of the Chancellor, he will get an allowance of £20 additional investment allowance, and will get £100 in the ordinary way as initial allowance, capital allowance and so on, and will thus receive £120. The point I am making is that we should not compare the £120 which he receives with the £100 which the plant costs originally, but should compare the £120 which he receives with the £120 which it costs to replace the plant. I am making assumptions, but I have to make an assumption of some kind, and I am making it in favour of the Chancellor, because I am assuming that his figure is 20 per cent., when in fact the inflation may be of a very much higher order than 2 per cent. over ten years. It is difficult to think of any recent Conservative Government which has been in power for ten years and has kept inflation down to 20 per cent. over those ten years. I am there

fore making these assumptions, which I think are reasonable.
The first point I make, therefore, is that this is a negligible inducement. The second point is that it is also a very remote inducement. Why is it going to cost the Chancellor nothing to give this inducement? The answer is, because the person receiving it does not get any benefit this year. A business man who receives this investment allowance receives it on plant bought this year, but he gets it at a time when his accounts for the year are completed and form the basis of his assessment for subsequent Income Tax years. Therefore, anybody who has been encouraged by the Finance Bill—and we want them to be encouraged to buy new plant, to modernise and make their works more efficient—on making inquiries will find that he is called upon to lay out his money now to get the benefit of the investment allowance in February, 1961, or later. February, 1961, would be the earliest date on which he would pay his 1960–61 Income Tax, based on his trading transactions when the machine is bought. He might pay his tax later, in March, April or May, and therefore there would be further delay.
My second point is that the inducement which the Chancellor is offering is remote, as well as negligible. My third point, and I have hinted at this before, is that it is also an unreliable one. The last time we had investment allowances, they lasted two years, and no sooner were people well under way in making arrangements for major reconstruction, on the basis of the inducements offered, than the investment allowance was withdrawn, with certain protection, I admit. The investment allowance was withdrawn, but expenditure contracted for was allowed for this purpose even if the expenditure itself came to be met after the date when it was withdrawn. Provided that it was contracted for, the expenditure was allowed.
I do not think this is sufficient, but I admit that though I have given the matter great thought, I cannot think of any other way in which the investment allowance can be withdrawn, and yet protection can be given to those who have taken considerable steps towards modernising their plant and yet have not entered into a contract before the date at which the investment was once more withdrawn. I


must refer to this because, as the Chancellor indicated, he hoped that there would be circumstances in which it was no longer necessary to have investment allowances. I am particularly concerned about this, and the Chancellor knows that I am not alone in this, as I referred to it earlier and The Times referred to it in a leader, as I recollect, at the time.
I refer to this because it is a general concern, and the Chancellor has made it clear that the investment allowance will be withdrawn again. I admit that I can think of no satisfactory remedy for administrative purposes for dealing with this point. Therefore, one comes back to the main argument that this has to be an attractive proposition to induce the business man to do what we want him to do —to modernise, to become more efficient and to start productivity on the up grade, instead of on the down grade, as it has been for so long.
One is bound to recognise that just as last year, if I may refresh the Chancellor's memory, he was flexible-minded enough to recognise that the passage of time between his Budget speech and the finalisation of the Finance Bill was sufficient to make him change his mind as to the level of initial allowances at that time and to increase the rate of initial allowances, so I suggest to the right hon. Gentleman that if he reconsiders the facts of today as against the background of the Economic Survey, which, no doubt, was at the back of his mind at the time he made his Budget speech, he will realise that that was an unwarranted, optimistic Survey and that what has happened since has not justified that at all.
We have had statements from the Paymaster-General that we are now on the upgrade, but there is no evidence whatever for that in the figures. The figures indicate that productivity, which we are after, and production, which we are concerned with in the Amendment, have not gone up as they should have done and that something, therefore, is needed as compared with what the Chancellor thought was needed judging by the Treasury papers at that time.
8.30 p.m.
I suggest to the Chancellor, therefore, that as the inducement offered is negligible. remote and unreliable he ought to accept our Amendment, which would

give just that little extra. That is what the Amendment would do. It transcends the sound barrier which the Chancellor has imposed of making investment allowances together with initial allowances the same as they would otherwise have been. The Amendment would give that little bit more.
Investment allowances and initial allowances are now to be a little more than they were. There is now to be a little attraction—not an enormous or expensive one—to those who are responsible for running businesses which involve plant, owning industrial and agricultural buildings and running mines. The Amendment would give them the necessary encouragement to do what the Chancellor wants and what we all want, namely, to bring into immediate consideration the plans for modernisation which they otherwise would not have brought into consideration until much later. For these reasons, I hope that the Chancellor will accept this modest Amendment.

The Chancellor of the Exchequer (Mr. Derick Heathcoat Amory): I enjoy following the hon. Member for Gloucester (Mr. Diamond) on a subject like this, because he speaks with a great and intimate knowledge of the problems involved. I find very little to quarrel with in the speech which the hon. Member has just made. I acknowledge that the right amount of encouragement to give in a matter like this is essentially a matter of judgment. I do not want to pontificate, or to be dogmatic that I have judged the matter aright. I want to try to explain why I cannot accept the Amendment, although, as I say, I do not quarrel with the statement that the hon. Member has made.
I have an estimate of what the Amendment would cost and I will give it to the Committee, because it would appear to be rather more than the hon. Member had in mind. We estimate that the cost of my proposals will be nothing this year, but in the year 1960–61 about £9½ million and in the year 1961–62 about £15 million. Our estimate is that the increases that the hon. Member proposes would cost nothing this year but in 1960–61 they would involve an extra cost of £13 million and in 1961–62 an increased cost of £23 million.
Those figures seem big. They arise, I think, from the fact, which the hon. Member has already pointed out, that my proposals, because the total remains the same, very largely replace the initial allowances in the earlier years by investment allowances, whereas the hon. Member's proposal would be something in addition to the present total of investment allowance and initial allowance.
I want to explain why I consider that my proposals will be sufficient. Again, however, I say, without being absolutely certain, that in the result they will turn out to be just right. The object, which the hon. Member has understood perfectly clearly, is to fortify a bit further the stimulus, and the steadiness following from it, which I gave last year in the Budget by increasing the initial allowances by 50 per cent., and to do something to encourage those who are planning investment expenditure to put that expenditure in hand now rather than a bit later, when there may not be as much spare capacity in industry as there has been recently and is likely to be in the immediate future.
Last year, in deciding on the stimulus, I had to be guided by the fact that at that time it was uncertain whether world trade was still receding, whether it had stabilised or whether it had begun to recover. Also, I was not certain—and the economists in general could not tell me—whether we had at that time got rid of our domestic inflation.
Thirdly, it was far from clear what precisely would be the course of private industrial investment, and private investment other than industrial investment, during the forthcoming 12 months. I then thought, and still think, that it was right to proceed in the matter, as in other matters, very cautiously, I gave a stimulus by increasing the initial allowances, but at that time right hon. and hon. Members opposite pointed out to me that I would have given a brisker stimulus if I had restored the investment allowances. For the reasons that I have given I did not feel able at that time to give a brisk encouragement but only a slight encouragement.
This year, in present circumstances—our balance of payments position is stronger and we can face some increase in imports —and, because of our internal position,

with inflation having been eliminated, I felt that I could safely go a bit further in this direction, but not too far. I have therefore decided that the amount which I have proposed is about right, but time may show that the hon. Gentleman's proposals were nearer what was required than mine. I feel at present that I must back my own judgment, but, as I have said, if it turns out otherwise, the hon. Member is perfectly free to point it out to me, as I have no doubt he will. In addition, there is the question of the quite substantial difference in cost.
The hon. Member thought that my proposal to substitute an investment allowance for two-thirds of the present initial allowance, leaving the other one-third as an initial allowance, would not have much effect. He thinks that the effect will be negligible, remote and not reliable. I doubt whether it will be negligible. Psychologically, industrialists who are wondering what to do are influenced much more by something which they will receive in addition to the full cost of the plant concerned than by initial allowances. Psychologically, it will certainly have an effect on marginal cases where industrialists are hesitating. I doubt whether the fact that the cash, as it were, is not received now but later will be a severe disincentive, although it will certainly detract in some cases.
The hon. Gentleman also said that my proposal was not reliable. I agree that two views can be held about this. The question is whether the putting on and taking off of investment allowances is a reasonable instrument for the Government to use in influencing the level of industrial investment. Some people say that it is not, that it may create uncertainty in the minds of businessmen and that they would not know where they were. I appreciate that, but, on the other hand, it is very important that the Government should have some instrument of influencing industrial investment beyond influencing it through the money rates and monetary control.
After a good deal of consideration—I admit that I have sometimes thought that there was a good deal of force in the other view—I feel that it is a legitimate instrument for the Government to use, but they must not expect it to have dramatic effects. If they apply it with the kind of warning that I gave, that economic circumstances may arise where


it would no longer be appropriate for the authorities deliberately to encourage and accelerate industrial development, and it might then be inappropriate any longer to retain the investment allowance and it would have to come off.
If and when that happened, I would think it right, as I said in reply to the hon. Gentleman the other day, for the Government to safeguard the position of those who have entered into contracts on the basis of the investment allowance. I would also agree that if it is put on and taken off too frequently—this applies to most instruments of control—it has an upsetting effect.
That is all I want to say to the Committee. I can only express my regret that, after considering the Amendment, its cost and its effects, I still feel that my proposal is about right this year. Therefore, my advice to the Committee must be not to accept the hon. Gentleman's suggestion, but, in saying that, I think it was entirely relevant that his view should have been put to the Committee.

Mr. E. Fletcher: I think that all of us on this side of the Committee agree with the Chancellor in his conclusion that it is right for the Government to use this instrument for increasing industrial and economic investment. I am afraid, however, that a good many people will be rather disturbed by the Chancellor's concluding remarks about the possibility of the investment allowances not being regarded as permanent or quasi-permanent.
I realise that there is a sense in which a Parliament cannot commit its successors and that a Chancellor of the Exchequer cannot commit his successors, but there is a very widespread feeling in industry, as was pointed out by my hon. Friend the Member for Gloucester (Mr. Diamond) on an earlier occasion and today, that if the use of this instrument is to have the desired effect of stimulating industry, as the Chancellor hopes and as we all hope, it is necessary that there should be some certainty in the minds of industrialists that investment allowances will not suddenly be withdrawn. It is reasonable to expect that there should be a fair measure of certainty about this.
As I understand the Chancellor's remarks, he has said that circumstances may change so dramatically that a

different policy may become necessary in a different phase of our economic situation. Apart from that very proper reservation, I hoped that the Chancellor would have been able to go further than he has gone. He said that if at any time the investment allowances were withdrawn he hoped that the then Chancellor of the Exchequer would preserve the benefits of the investment allowances in respect of contracts already entered into. I do not think that that goes sufficiently far to allay the fears of the business community.
The mere entering into of a contract ought not to be the real test. A great many companies of various kinds will, on the strength of these investment allowances, make plans for capital expansion over a period of time, plans which may take two or three years to mature. As we all know, this will cost the Government nothing this year. One cannot measure this kind of commitment and this kind of contemplated expansion in a mere twelve months or even a period of two years. The plans have first to be made. Very often the time for entering into a contract comes at a relatively late date in the development plan which a company has to undertake.
8.45 p.m.
I hope that it will be recognised by both the Chancellor and the Committee that if, on the strength of the investment allowances now being enacted, a company prepares a scheme of capital development which may be spread over two, three or four years, it should be able to look forward with confidence to implementing that planning capital expansion in reliance on these investment allowances, without their being suddenly withdrawn, and with confidence that if for some reason there is subsequently a change and no future investment allowances are granted, there will be complete protection and complete safeguarding for all the steps taken as a result of the new policy upon which we are now embarking.

Mr. Diamond: Does not my hon. Friend agree that there may be circumstances—and, indeed, there are—in which a business finds itself absolutely committed to a redevelopment scheme without having literally contracted to an outside party in that way?

Mr. Fletcher: I am much obliged to my hon. Friend, who has put very succinctly the point I was trying to make.
The Chancellor suggested that the test would be the safeguarding of outstanding contracts. The point that my hon. Friend and I were trying to make is that that does not go far enough. If the business community is to be satisfied and reassured on this matter, there ought to be as binding an undertaking as one can constitutionally expect that all commitments and all plans for capital expansion which are undertaken in reliance on these new investment allowances will be allowed to proceed.

Mr. H. Rhodes: I doubt very much whether investment allowances on their own will be sufficient to create a climate of business opinion strong enough to influence companies to undertake investment. Whenever investment allowances or initial allowances have been granted, the issue has always seemed to be clouded by something done previously which has either set off an expansion of production or worked towards its decline. To some extent, as a consequence of that, the virtue of investment allowances on their own remains unknown.
They are an interesting form of encouragement. Having put them on, the Chancellor should now take advantage of a method used in the last year or two for collecting business opinion. Directors of selected companies have been asked for their opinions on the state of their order books. If such a method has had any virtue, the results have been worth while.
Instead of asking businesses what they think about their prospects when a decline sets in. the Chancellor ought to reverse the procedure and ask them what they think of their prospects and what has induced them to invest in machines now. If this is not done the issue will always be confused. It has come after the relaxation of hire purchase and we ought to be able to sort it out now. We ought to be asking ourselves whether this later inducement of the investment allowance, coming behind the gamut of inducements to increase production, is doing what it should in connection with the right sort of investment.
There are two kinds of encouragement. The first is to increase production at a time when the economy is flagging, and

the second to increase the productivity of the individual machine irrespective of an up or down movement in the economic life of the community or world trade. At some time or other we shall discover the real assistance needed from the Treasury to provide inducements to invest in productive machines. I mentioned this on Second Reading and I will not go over the ground again, but I think that we shall have to make up our minds about the type of encouragement that we should give for productivity.
There are two aspects of productivity. One is the making of new things with new techniques which in themselves attract money because of their profitability and very often the smaller amount of money needed for wages compared with the older industries with older techniques. The ability of older industries to get increased productivity runs down over the years, not because of the age of the machines but because of the age of the know-how and the technique which has been employed for so long. A time eventually comes in older industries when inventiveness is needed to set them going again to catch up with the countries which use the old techniques, but which are paying lower wages.
I am not pressing this point, but it is something to think about. These investment allowances should be geared to the kind of productivity that the purchases of the machines will yield. At so late a stage in an upsurge of production, I do not think it is much use encouraging people to buy more machines unless they are absolutely certain that the machines are the right ones.
After the Whitsun Recess, when we shall find ourselves confronted with the task of handing over sums of money to assist an old industry to buy new plant, we shall be faced with the danger that the machines which are secured may not be good enough, and it may well be that in ten years' time we shall have to go over the whole business again. I suggest to the Chancellor, therefore, that this thing needs thinking out in relation to productivity with which should be contrasted any allowances or inducements given by the Treasury.
I am not looking a gift horse in the mouth because I made my own arrangements some time before the Budget statement. But the extent of the value accruing from these inducements is something


that we do not know, nor do we know the extent of the influence of a favourable climate of opinion in industry. We could gain a lot of information from people who have made decisions during the last few weeks, and I think that we should ask such people about the effect of this concession upon them.

Mr. Gordon Walker: The right hon. Gentleman said that he found little to quarrel with in the speech of my hon. Friend the Member for Gloucester (Mr. Diamond). I wish I could say as much for my attitude to the remarks of the Minister. I agree with one thing that the right hon. Gentleman said. He admitted that a monetary policy was an inadequate instrument of control. That is something which we have been arguing for a long time. The right hon. Gentleman's predecessor always maintained that everything should be done by monetary control, and I was glad to hear the right hon. Gentleman say that a monetary policy needed to be reinforced by other instruments.
I was sorry to hear what the right hon. Gentleman had to say about this Amendment, which we take very seriously. It represents a continuance of the argument which we advanced this time last year, that the investment allowance should have been introduced then and that the Chancellor delayed the re-expansion of the economy for an inexcusably long time. But we have to deal with things as they are. so we have tabled this Amendment, which is designed to increase the encouragement to investment which, a year too late, the Chancellor has put into his Budget.
The reason we take this Amendment seriously is that we believe strongly in more investment. My hon. Friend the Member for Gloucester said that the effect of the Chancellor's proposals would be negligible. I do not think that the Chancellor understood the argument advanced by my hon. Friend, who maintained that it would be negligible because it would, in fact, do no more than meet the increased cost of replacement. In all probability there will be a rise in prices. Machines will cost more to replace in the end and the amount of the allowance which the Chancellor is giving—so my hon. Friend argued—would only offset the increase in the replacement costs.
I am sure that the right hon. Gentleman was impressed when my hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes) said that nobody really knows the effect of the investment allowances, taken by themselves. I hope that the right hon. Gentleman will consider favourably the proposal of my hon. Friend that an inquiry should be made to try to ascertain the motives which have led, or are likely to lead, managements to increase investment; how far it is due to the investment allowances: and how far to a reduction of hire purchase restrictions, and so forth.
9.0 p.m.
Our main argument is that we need more investment. I was very struck by the figures which the right hon. Gentleman gave for the cost of our proposals. It was £13 million extra, over and above what he has decided to give in this field in the period 1960–61, and £23 million in 1961–62. This seems an argument in favour of our Amendment. This shows that the Amendment would make a very great difference, and that there would be a real demand and use for these investment allowances. The right hon. Gentleman can only have worked out this cost on the assumption that the investment allowances would be used and would result in quicker and more modern machinery.
We regard the figures which he gave —they surprised us because we did not think that they were as high—as an argument in favour of what we are saying. It shows that there is a very great need for increased investment. So far from that being an argument against our proposal, it is one in favour of it. If the proposal would bring about this sort of difference the Chancellor should have arranged his Budget in such a way that he could find the extra £13 million and £23 million by a very slight marginal redistribution of the various reliefs. He should have rearranged things so as to find this marginal amount in the total reliefs which he was giving.
What is wrong with this country is that it does not get enough investment and that it is lagging behind the high-investment countries. In the last three or four years other countries which are comparable with us are getting ahead because they are really high-investment countries. Compared with them, we are a low-investment country. The right hon.


Gentleman has talked a great deal about wages, the need for wage restraint, the effect that an increase of wages would have upon prices, and so forth. He forgets when he says this sort of thing that one can exaggerate the effect of wages upon the putting up of prices.
Wages have gone up at least as fast in Western Germany as in this country over the comparable period, but prices have not gone up as fast. The reason is that productivity has gone up in Western Germany much faster than in this country. The reason why productivity has gone up faster there is that the rate of investment has been much higher. That is why we lay so much stress and emphasis upon the need for increased investment in this country at a rate faster than is being done. That will not only help and enlarge our future wealth but will directly help to fight inflation. We must change this lagging behind other comparable countries in the rate of investment in Britain.
I was very disturbed to hear the Chancellor say again what he said in his Budget speech, namely, that the investment allowances might well come off again. That discloses an attitude of mind which I find alarming. It means that the right hon. Gentleman does not regard it as part of his duty and policy to create a steady drive of investment in this country but merely to have a little spurt now and then. He is looking forward to

the time, after the so-called slack in the economy has been taken up, when he can go into reverse.

Mr. Amory: indicated dissent.

Mr. Gordon Walker: If the right hon. Gentleman does not mean this, I hope he will tell us what he meant by saying that he must warn industry "not to reckon on them", and so forth?
All this gives a wholly wrong impression. The policy of Her Majesty's Government ought to be to stimulate a steady drive of high investment in this country; so that, instead of lagging behind countries like Western Germany we should, as we rightly ought, be ahead of her in this matter and in all the things that flow from it. We feel very strongly about it and we are very far from satisfied with the right hon. Gentleman's reply and with the attitude of mind that that reply disclosed.
If the Chancellor will not change his mind on this matter, I must ask my right hon. and hon. Friends to go into the Division Lobby to show that we have an utterly different approach to the whole policy of high investment in this country from that of this lagging, laggard and niggardly Government.

Question put, That those words be there inserted:—

The Committee divided: Ayes 170, Noes 213.

Division No. 113.]
AYES
[9.7 p.m.


Ainsley, J. W.
Craddock, George (Bradford, S.)
Hastings, S.


Albu, A. H.
Cronin, J. D.
Hayman, F. H.


Allen, Arthur (Bosworth)
Crossman, R. H. S.
Healey, Denis


Allen, Scholefleld (Crewe)
Davies, Harold (Leek)
Henderson, Rt. Hn. A. (Rwly Regis)


Awbery, S. S.
Davies, Stephen (Merthyr)
Herbison, Miss M.


Bacon, Miss Alice
Deer, G.
Hewitson, Capt. M.


Bence, C. R. (Dunbartonshire, E.)
Delargy, H. J.
Hobson, B. R. (Keighley)


Blackburn, F.
Diamond, John
Holman, P.


Blenkinsop, A.
Ede, Rt Hon. J. C.
Holmes, Horace


Blyton, W. R.
Edelman, M.
Houghton, Douglas


Boardman, H.
Edwards, Rt. Hon. John (Brighouse)
Hughes, Cledwyn (Anglesey)


Bottomley, Rt. Hon. A. G.
Edwards, Rt. Hon. Ness (Caerphilly)
Hughes, Emrys (S. Ayrshire)


Bowden, H. W. (Leicester, S.W.)
Edwards, W. J. (Stepney)
Hughes, Hector (Aberdeen, N.)


Bowles, F. G.
Evans, Albert (Islington, S.W.)
Hunter, A. E.


Braddock, Mrs. Elizabeth
Evans, Edward (Lowestoft)
Hynd, H. (Accrington)


Brockway, A. F.
Fernyhough, E.
Hynd, J. B. (Attercliffe)


Broughton, Dr. A. D. D.
Fletcher, Eric
Irvine, A. J. (Edge Hill)


Brown, Rt. Hon. George (Belper)
Forman, J. C.
Irving, Sydney (Dartford)


Brown, Thomas (Ince)
Fraser, Thomas (Hamilton)
Janner, B.


Burke, W. A.
Gibson, C. W.
Jay, Rt. Hon. D. P. T.


Burton, Miss F. E.
Gordon Walker, Rt. Hon. P. C.
Jeger, George (Goole)


Butler, Herbert (Hackney, C.)
Greenwood, Anthony
Jeger, Mrs. Lena(Holbn.&amp; St. Pncs, S.)


Carmichael, J.
Grenfell, Rt. Hon. D. R.
Jones, Rt. Hn.A. Creech(Wakefield)


Castle, Mrs. B. A.
Grey, C. F.
Jones, Jack (Rotherham)


Champion, A. J.
Griffiths, David (Bother Valley)
Jones, J. Idwal (Wrexham)


Chapman, W. D.
Griffiths, Rt. Hon. James (Lianelly)
Kenyon, C.


Ghetwynd, G. R.
Griffiths, William (Exchange)
King, Dr. H. M.


Cliffe, Michael
Hale, Leslie
Lawson, C. M.


Coldrick, W.
Hall, Rt. Hn. Glenvil (Colne Valley)
Lee, Frederick (Newton)


Collick, P. H. (Birkenhead)
Hamilton, W. W.
Lee, Miss Jennie (Cannock)


Corbet. Mrs. Freda
Hannan, W.
Lindgren, G. S.




Mahon, Dr. J. Dickson
Paton, John
Soskice, Rt. Hon. Sir Frank


McAlister, Mrs. Mary
Pearl, T. F.
Spriggs, Leslie


McCann, J.
Pentland, N.
Stones, W. (Consett)


MacColl, J. E.
Plummer, Sir Leslie
Summerskill, Rt. Hon. E.


McInnes, J.
Prentice, R. E.
Sylvester, G. O.


McKay, John (Wallsend)
Price, J. T. (Westhoughton)
Taylor, Bernard (Mansfield)


MoLeavy, Frank
Price, Philips (Gloucestershire, W.)
Taylor, John (West Lothian)


MacPherson, Malcolm (Stirling)
Probert, A. R.
Thomas, lorwerth (Rhondda, W.)


Mahon, Simon
Pursey, Cmdr. H.
Thomson, George (Dundee, E.)


Marquand, Rt. Hon. H. A.
Rankin, John
Thornton, E.


Mason, Roy
Redhead, E. C.
Watkins, T. E.


Mayhew, C. P.
Reeves, J.
Wells, William (Walsall N.)


Moody, A. S.
Reid, William
Wheeldon, W. E.


Morris, Percy (Swansea, W.)
Reynolds, G. W.
White, Henry (Derbyshire, N.E.)


Mort, D. L.
Rhodes, H.
Wilkins, W. A.


Moss, R.
Robinson, Kenneth (St. Pancras, N.)
Willey, Frederick


Moyle, A.
Rogers, George (Kensington, N.)
Williams, Rt. Hon. T. (Don Valley)


Mulley, F. W.
Ross, William
Willis, Eustace (Edinburgh, E.)


Noel-Baker, Rt. Hon. P. (Derby, S.)
Royle, C.
Wilson, Rt. Hon. Harold (Huyton)


Olivet, G. H.
Short, E. W.
Winterbottom, Richard


Orem, A. E.
Silverman, Julius (Aston)
Woof, R. E.


Orhach, M.
Silverman Sydney (Nelson)
Yates, V. (Ladywood)


Oswald, T.
Skeffington, A. M.
Zilliaous, K.


Owen W. J.
Slater, J. (Sedgefield)



Padley, W. E.
Smith, Ellis (Stoke, S.)



Palmer, A. M. F.
Snow, J. W.
TELLERS FOR THE AYES:


Parker, J.
Sorensen, R. W.
Mr. Pearson and Mr. Simmons.




NOES


Agnew, Sir Peter
Eden, J. B. (Bournemouth, West)
Langford-Holt, J. A.


Aitken, W. T.
Elliott, R. W.(Ne'eastle upon Tyne, N.)
Leavey, J. A.


Amory, Rt. Hn. Heathcoat (Tiverton)
Emmet, Hon. Mrs. Evelyn
Legge-Bourke, Maj. E. A. H.


Anstruther-Gray, Major Sir William
Errington, Sir Eric
Legh, Hon. Peter (Petersfield)


Armstrong, C. W.
Erroll, F. J.
Lindsay, Hon. James (Devon, N.)


Ashton, H.
Fell, A.
Lindsay, Martin (Solihull)


Atkins, H. E.
Finlay, Graeme
Linstead, Sir H. N.


Baldock, Lt.-Cmdr. J. M.
Fisher, Nigel
Lloyd, Maj. Sir Guy (Renfrew, E.)


Baldwin, Sir Archer
Fletcher-Cooke. C.
Longden, Gilbert


Barber, Anthony
Fort, R.
Loveys, Walter H.


Barlow, Sir John
Freeth, Denzil
Lucas-Tooth, Sir Hugh


Barter, John
Gammons, Lady
Maodonald, Sir Peter


Botsford, Brian
George, J. C. (Pollok)
McLaughlin, Mrs. P.


Beamish, Col. Tufton
Glover, D.
Macleod, Rt. Hn. lain (Enfield, W.)


Bell, Philip (Bolton, E.)
Glyn, Col. Richard H.
McMaster, Stanley


Bevins, J. R. (Toxteth)
Godher, J. B.
Macmillan, Rt. Hn. Harold(Bromley)


Biggs-Davison, J. A.
Goodhart, Philip
Maitland, Cdr. J. F. W.(Horncastle)


Bingham, R. M.
Gough, C. F. H.
Maitland, Hon. Patrick (Lanark)


Birch, Rt. Hon. Nigel
Gower, H. R.
Markham, Major Sir Frank


Bishop, F. P.
Graham, Sir Fergus
Marlowe, A. A. H.


Black. Sir Cyril
Green, A.
Marples, Rt. Hon. A. E.


Body, R. F.
Gresham Cooke, R.
Marshall, Douglas


Bonham Carter, Mark
Grimond, J.
Mathew, R.


Bowen, E. R. (Cardigan)
Gurden, Harold
Mawby, R. L.


Boyd-Carpenter, Rt. Hon. J. A.
Hall, John (Wycombe)
Maydon, Lt.-Comdr. S. L. C.


Boyle, Sir Edward
Harris, Reader (Heston)
Medlicott, Sir Frank


Braine, B. R
Harrison, A. B. C. (Maiden)
Molson, Rt. Hon. Hugh


Brew's, John
Harrison, Col. J. H. (Eye)
Mott-Radclyffe, Sir Charles


Bromley-Davenport, Lt.-Col. W. H.
Harvey, Sir Arthur Vere(Macciesf'd)
Heave, Alrey


Brooman-White, R. C.
Harvey, John (Walthamstow, E.)
Nicholson, Sir Godfrey (Farnham)


Browne, J. Nixon (Craigton)
Heald, Rt. Hon. Sir Lionel
Nicolson, N.(B'n'm'th, E. &amp; Chr'oh)


Burden, F. F. A.
Heath, Rt. Hon. E. R. G.
Noble, Michael (Argyll)


Butler, Rt. Hn. R. A. (Saffron Waiden)
Henderson, John (Cathcart)
Nugent, Richard


Campbell, Sir David
Henderson-Stewart, Sir James
Oakshott, H. D.


Carr, Robert
Hill, Mrs. E. (Wythenshawe)
Ormsby-Gore, Rt. Hon. W. D.


Cary, Sir Robert
Hirst, Geoffrey
Osborne, C.


Channon, H. P. G.
Holland-Martin, C. J.
Page, R. G.


Chichester-Clark, R.
Holt, A. F.
Partridge, E.


Clarke, Brig. Terence (Portsmth, W.)
Hornby, R. P.
Peel, W. J.


Conant, Maj. Sir Roger
Horobin, Sir Ian
Peyton, J. W. W.


Cooke, Robert
Horsbrugh, Rt. Hon. Dame Florence
Pickthorn, Sir Kenneth


Cordeaux, Lt.-Col. J. K.
Howard, Hon. Creville (St. Ives)
Pike, Miss Mervyn


Corfield, F. V.
Howard, John (Test)
Pilkington, Capt. R. A.


Craddock, Beresford (Spelthorne)
Hughes, Hallett, Vice-Admiral J.
Pitman, I. J.


Crosthwaite-Eyre, Col. O. E.
Hughes. Young, M. H. C.
Pitt, Miss E. M.


Crowder, Sir John (Finchley)
Hurd, Sir Anthony
Pott, H. P.


Cunningham, Knox
HutchisomMichael Clark(E'b'gh, S)
Powell, J. Enoch


Dance, J. C. G.
Hylton-Foster, Rt. Hon. Sir Harry
Price, David (Eastleigh)


Davidson, Viscountess
Iremonger, T. L.
Price, Henry (Lewisham, W.)


D'Avigdor-Goldsmid, Sir Henry
Jenkins, Robert (Dulwich)
Prior-Palmer, Brig. O. L.


tie Ferranti, Basil
Jennings, Sir Roland (Hallam)
Ramsden, J. E.


Doughty, C. J. A.
Johnson, Eric (Blookley)
Rawlinson, Peter


du Cam, E. D. L.
Kerr, Sir Hamilton
Redmayne, M.


Dugdale, Rt. Hn. Sir T. (Richmond)
Kirk, P. M.
Rees-Davies, W. R.


Duncan, Sir James
Lancaster, Col. C. G.
Remnant, Hon. P.







Rldsdale, J. E.
Taylor, Sir Charles (Eastbourne)
Walker-Smith, Rt. Hon. Derek


Roper, Sir Harold
Taylor, William (Bradford, N.)
Wall, Patrick


Ropner, Col. Sir Leonard
Teeling, W.
Ward, Rt. Hon. C. R. (Worcester)


Russell, R. S.
Temple, John M.
Ward, Dame Irene (Tynemouth)


Sharpies, R. C.
Thomas, Leslie (Canterbury)
Webbe, Sir H.


Shepherd, William
Thompson, R. (Croydon, S.)
Webster, David


Simon, J. E. S. (Middlesbrough, W.
Thorneycroft, Rt. Hon. P.
Whitelaw, W. S. I.


Spearman, Sir Alexander
Thornton-Kemsley, Sir Colin
Williams, Paul (Sunderland, S.)


Spens, Rt. Hn. Sir P. (Kens'gt'n, S
Turner, H. F. L.
Williams, R. Dudley (Exeter)


Stanley, Capt. Hon. Richard
Turton, Rt. Hon. R. H.
Wills, Sir Gerald (Bridgwater)


Stevens, Geoffrey
Tweedsmuir, Lady
Wilson, Geoffrey (Truro)


Steward, Harold (Stockport, S.)
Vane, W. M. F.
Woffige-Gordon, Patrick


Steward, Sir William (Woolwich, W.)
Vaughan-Morgan, J. K.
Woollam, John Victor


Stoddart-Scott, Col. Sir Malcolm
Vickers, Miss Joan
Yates, William (The Wrekin)


Storey, S.
Vesper, Rt. Hon. D. F.



Studholme, Sir Henry
Wade, D. W.
TELLERS FOR THE NOES:


Summers, Sir Spenoer
Wakefield, Edward (Derbyshire, W.)
Mr. Bryan and Mr. J. E. B. Hill.

9.15 p.m.

Dame Irene Ward: I beg to move, in page 15, line 12, at the end to insert:
(3) Notwithstanding subsections (1) and (2) of this section, an initial allowance shall be made of one-tenth of any expenditure incurred after the seventh day of April, nineteen hundred and fifty-nine, on the construction, extension or modification of dry docks in the United Kingdom; and on any expenditure incurred as aforesaid, the investment allowance made under subsection (1) of this section shall be increased from one-tenth to one-fifth of such expenditure.
The purpose of the Amendment is to transfer dry docks for the purpose of investment and initial allowances from the category designated industrial buildings and structures into the category designated plant and machinery, thus attracting an increase in both investment and initial allowances.
I wish that my right hon. Friend the Chancellor went to sea in a tanker instead of in a yacht, because I cannot help feeling that his appreciation of dry docks is coloured by the part of the country from which he sails and the attitude of that part of the country to the repairing of yachts. In that part of the country we find charming little villages and men with consummate skill tinkering with the little boats which my right hon. Friend enjoys so much. We find sparkling rivers, the sun shining and everything pleasant and in no way related to the great industrial problems of dry docks which belong to the parts of the country concerned with shipbuilding in a big way. At any time I should welcome a visit from my right hon. Friend to the Tyne or any other great industrial river so that he may see what dry docks mean to the shipping and shipbuilding industry.
Part of the case for the acceptance of the Amendment is that we want the entire industry—shipping, shipbuilding and ship repairing—looked at as a whole. Dry

docks are the garages of our merchant ships and naval ships, and I argue the Amendment from that point of view.
Curiously enough, investment in dry docks is a singularly unattractive form of investment, partly because the construction of the docks is extremely expensive and partly because, after their construction, there is a relatively long period, which the dry dock owners estimate may be as long as a decade, before the dock is used more than intermittently by ships of the size for Which it was constructed. Over that period, it is alleged—and I am sure with truth—that the rents of the dock are very little more than the interest charged on the loans for the construction of the dock.
I fully realise that I have to try to make a case to overcome the refusal which the dry dock owners and those who have supported their claims have met in the House on many occasions. If I remember rightly, I had a conversation with my right hon. Friend one day in which the old question of precedent cropped up. It seems to me that if we spent a little more time in our Parliamentary life looking up precedents we might get a little further in moving Amendments to the Finance Bill.
One of my colleagues has suggested to me that brick walls surrounding timber kilns attract investment and initial allowances as plant and machinery. It seemed to me that this was an analogy. I understand from further investigations that this rate of investment and initial allowance was not due to any insertion in any Finance Bill but that it has been a practice of the Inland Revenue to allow brick walls to be charged in the category of plant and machinery. That is a very valuable precedent with which to try to persuade the Chancellor to accept the Amendment.
May I, I hope not frivolously, express this point of view. We must have the brick walls for these timber kilns. If we took away the things that make a dry dock a dry dock, it would become a wet dock. I understand that part of my right hon. Friend's argument against accepting an Amendment of this kind is that the gate and certain parts of the machinery of the docks attract the higher investment allowance and the higher initial allowance. For some extraordinary reason, the part that makes the dock a dry dock does not seem to attract those higher allowances.
When I opened my newspaper this morning and saw that my right hon. Friend had suddenly decided to go into space, quite apart from the fact that he sails in yachts and not in tankers, I had a rather nostalgic feeling for that old jingle:
The owl and the pussy cat went to sea
In a beautiful pea green boat".
I want to point out immediately to my right hon. Friend that "owl", as I must be the pussy cat, is synonymous with "wisdom". When I have outlined one of the reasons why it seems to me to be right and proper that dry docks should be in the category of plant and machinery, I hope that my right hon. Friend will agree that I have made out my case.
In Parliamentary and political life, as one moves about in the great industrial centres of the country quite a lot of information comes one's way, fortunately. Otherwise, one would never be able to persuade the Front Bench to accept any Amendment from the back bench. I have heard it suggested that, if it were possible to call a few Departments together in support of the argument which I am advancing, we might have a great ally in the Admiralty. On Tyneside we do not build great commercial ships only. We also build great naval ships. Great naval ships require dry docks just as much as great commercial ships.
It has been suggested to me from one source and another in my wanderings that a certain amount of pressure has been exercised on my right hon. Friend, I am afraid unsuccessfully up to date, but perhaps when the Navy and commerce join together we shall make an impression. I am told that the Admiralty also would welcome the Amendment.
It is obvious that, though I try to represent the big industrial North from which I come, I cannot have much technical knowledge of these subjects. I suggested yesterday, in arguing about Purchase Tax, that one of the difficulties is that, once one Government Department obtains a decision from the Cabinet to go ahead, it goes ahead. The Parliamentary Secretary to the Board of Trade has been very vigorous in going about the countryside in relation to the powers of the Board of Trade under D.A.T.A.C. I think that that is the correct description of one of his new functions.
It is true that in areas that are specially designated one might get some assistance for the construction of new dry docks through D.A.T.A.C., but one cannot deal with dry docks in the same way as one can deal with industrial buildings. That is why I think it very unfortunate that dry docks are in the category of industrial buildings and structures. We have to construct our dry docks in the places most suitable for their construction, and although I have no doubt that the Cabinet and my right hon. Friend have given the go-ahead to the Parliamentary Secretary to the Board of Trade, it is not a very satisfactory way of dealing with this great industry.
When we have been arguing about some of the difficulties that have arisen in our shipping, our shipbuilding or our ship-repairing industries—and they are, after all, the life blood of the nation—the answer has always been, "Of course, we want to do everything we can to help them, but they are so difficult to help. "I therefore suggest to my right hon. Friend that when one partner in the great unified whole of the shipbuilding industry makes a practical suggestion that will he helpful to shipping and shipbuilding, it should be seriousy considered. We are building larger and larger tankers, we are being called upon to build larger and larger merchant ships, and we cannot look after our very valuable shipping fleet unless there are proper maintenance arrangements.
In the aircraft industry, maintenance has attracted a great deal of the Government's attention, and I cannot understand why the maintenance of our great ships should not be of equal interest. My right hon. Friend says that he genuinely wants to help this industry, so, when one section of it puts forward a practical proposal,


I beg of him to take advantage of this great opportunity and to give the industry what it desires so tremendously. On behalf of the dry dock owners and of all those who work in these great ship-repairing yards, I can tell the Committee that I have moved this Amendment with great confidence.

Mr. Stevens: I should like, very briefly but very emphatically, to support the Amendment moved by my hon. Friend the Member for Tynemouth (Dame Irene Ward). In doing so, I must declare an interest. Two years ago, the firm of which I am a partner was asked to carry out a factual investigation into the taxation treatment of dry dock owners and ship repairers, both here and in other countries. A very interesting series of facts resulted from that investigation.
It emerged, beyond any shadow of doubt that the taxation treatment of those who own dry docks, and who repair ships in every other country is on a very much more generous scale than it is here. In saying that, one must remember that shipping is unique in its competitive nature. It is obviously so easy for a ship to cross the Atlantic, and ii is equally obvious that the shipowner will have the vessel repaired where the repair facilities are not only the most convenient but also the cheapest.
To emphasise that point I should like to give a very few figures. Whereas, before the present Finance Bill, the cost of building a dry dock here could be written off for tax purposes over forty-five years, if we look at some other maritime competitors we find that in Sweden the cost is written off in only thirty-three years; in Holland, in twenty-five years, and in France, in twenty years. That is a tremendous handicap on our ship repairers.
It is perfectly true that Clause 17 somewhat improves the position of the ship repairers, but only to the extent of about 10 per cent. That tremendous tax handicap therefore remains. It seems to me that if those engaged in an industry as highly competitive as the ship-repairing industry have that handicap to compete with, it is impossible to expect them to maintain this country's position as the premier ship-repairing nation of the world.
With those few words, and on those solid grounds, I support with great

pleasure the Amendment moved by my hon. Friend the Member for Tynemouth.

9.30 p.m.

Mr. Ede: I support this Amendment. We should remember that in recent years —and, looking into the future, the same tendency seems likely to persist—there has been a demand for bigger dry docks and that those which have been built in the past are now not suitable, owing to their restricted size, for dealing with the commercial craft, particularly tankers and similar vessels which exist today.
A few minutes ago I saw the right hon. Gentleman the Minister of Labour and National Service in the Chamber. I can well understand his interest in this issue because, wherever else in the labour situation he may find anything to cheer his heart, he has been quite frank in telling us that shipbuilding and ship repairing are the industries which now give him the most anxiety. I sincerely hope that the Government will realise that this is a matter of vital concern not merely to the dry dock owners but to the large number of people in this country who are engaged in ship repairing.
We made a tremendous mistake in the years immediately before the Second World War in allowing the teams of labour which had been built up in these firms on the Tyneside and elsewhere to disintegrate, and even during the worst period of the war we were never able to reassemble those teams.
A peculiarity of this industry is that the firms seem to build up a body of men capable of dealing with their specific needs. The present plight of this industry is getting far too near the situation which existed immediately before the Second World War for anyone to regard this plight with equanimity. If the necessary expansion of the docks and of their equipment is to take place, very considerable assistance will be required from those who control investment allowances and the other matters which are dealt with in this Amendment.

Mr. Peter Rawlinson: I am glad to be able to follow the right hon. Member for South Shields (Mr. Ede) whom I represent in the House of Commons, and to say that I support everything that he has said.
I must admit that my main interest is more in docks of a different nature than those which we are discussing tonight. I should first of all declare a personal interest, as I have already done on a previous occasion when a similar subject was under discussion, in that for hundreds of years there has been a family concern on the Merseyside, engaged formerly in shipbuilding but now in ship-repairing.
As an illustration of some of the arguments which have already been used, I would tell the Committee that this company on the Merseyside is at present engaged in the enlargement of a dry dock. That will take several years to complete, at a cost of about £1½ million, so that we shall be able to cater for the new type of ships, the tankers of up to 65,000 tons. That is a dock from which, as my hon. Friend has already said, the company cannot expect to receive any economic return for a period of eight to ten years. It is essential for the long-term efficiency of ship-repairing to have docks of this size, so as to be able to meet the foreign competition, which becomes more acute with every single day, and to provide for this revolution in shipbuilding which we have seen in the last decade.
I say with regret that this industry has received very little encouragement from the Government. Always there is this emphasis generally upon this great heritage of shipbuilding, and the great dependence of this country upon the sea and the trades and industries which are allied to the sea. We have continual assertions about the strategic importance of keeping a healthy and flourishing Merchant Navy and the ports and docks which serve such a Merchant Navy. Now, we have the new oil and fuel carriers of vastly greater size, and therefore we have to have the docks able to cater for them and to service them.
In 1957, I invited the then Chancellor to treat the dock as plant, as opposed to industrial buildings, and my right hon. Friend the Member for Flint, West (Mr. Birch), then Economic Secretary to the Treasury, said that we were claiming, as an industry, discriminatory tax relief. Surely, it is the duty of a Chancellor to be discriminatory, and while I would not associate my right hon. Friend particularly with 1984, I would say that some Chancellors are discriminatory, and that

some seem to be even more discriminatory than others.
I hope my right hon. Friend will be more discriminatory in this instance, because I think there is a case for the docks, as there is not in many other industries, for a dock is not like an industrial building. One cannot build, supply or provide it, or put it in a certain place, to provide the answer to some labour problem which there exists. It cannot be used for any other purpose, as the premises of a factory can be. It is a hole in the ground which can be used for one purpose only, and it is a one-purpose asset. Therefore, as a one-purpose asset, in my submission, it is plant and not a building.
My right hon. Friend the Prime Minister, in 1957, talking about the demand and the need for oil services, spoke of the real sense of urgency which existed in the Government. I ask that a real sense of urgency should be reflected by giving this assistance to this industry, because its foreign competitors are almost given their ships by the foreign Governments, and they are given their docks. In the case of our foreign competitors, a floating dock is treated as plant, and therefore all we are asking here is for proper relief and re-assessment of the category in which docks are at present placed.
The hon. Member for Stechford (Mr. Roy Jenkins), when he spoke on a similar Amendment in 1957, rather pooh-poohed the arguments we had raised, saying that the industry faced a great period of prosperity. It certainly does not face it now, as the right hon. Gentleman the Member for South Shields has already said. There is grave unemployment, and there are difficulties facing this industry. There-force, I ask my right hon. Friend to make this concession not only for ordinary commercial reasons—for ordinary commercial justice in treating docks as plant rather than industrial buildings, because they are in an entirely different category—but also because, for national reasons of employment and also for strategic reasons, it is important to keep these docks and this industry in a healthy and vigorous position, so that they can meet the challenge from foreign competitors.
As I said at the beginning, I speak with a direct personal interest which I want to make perfectly clear, because it


arises from an association with the industry and not from anything concerned with my constituency. After the various arguments which have been put before my right hon. Friend, this surely is an industry which needs stimulus and help of this kind and I hope that he will be able to accept the Amendment.

Mr. Frederick Willey: I support my right hon. Friend the Member for South Shields (Mr. Ede) in supporting the Amendment. We are obliged to the hon. Lady the Member for Tynemouth (Dame Irene Ward) for taking the opportunity of raising this issue, which particularly affects us in the North-East. The North-East Coast is the greatest ship-repairing area in the world. When attempts are made to denigrate the workers in this industry, I say at once that ship-repairing workers are among the finest workers in the world.
I am surprised at the absence of the hon. Member for Sunderland, South (Mr. P. Williams). It is unfortunate that he has chosen to be absent on this occasion, because when, in the past, I have pleaded on behalf of these great shipbuilding and ship-repairing industries he has suggested that the proper approach is the very approach that the hon. Lady is proposing tonight, that there should be a taxation concession. Now that the issue is put and the matter may be tested by Division, however, the hon. Member is not with us. [An HON. MEMBER: "He may turn up"] I hope so. He has a responsibility here.
I join the plea for discriminating in favour of the ship-repairing industry. I agree that if the circumstances demand it, we are entitled to discriminate in favour of an industry. As I have said before, that is at least some measure of planning. We must realise that the ship-repairing industry is facing a real dilemma. It is facing enormous capital costs in extremely difficult circumstances. It is facing unavoidable substantial capital costs because it has to provide the facilities, as the hon. and learned Member for Epsom (Mr. Rawlinson) said, for the new tankers, the new ore carriers and the other large ships that are coming into world shipping.
We must do that to hold our own, but we have got to do it in circumstances which, to say the least are extremely difficult, because the shipbuilding and ship-repairing industries face a capacity in the world which is far too large. On the

one hand, they cannot afford to prejudice themselves by not having the facilities that are required. If they do that, they will lose their place. I remind the Chancellor of what has happened to our great industries under the present Government. Liberia, which, ten years ago, had only one ship of 1,000 tons, now challenges us with the greatest mercantile fleet in the world. Shipbuilding capacity is three times what it was a few years ago. At least, the Government should recognise the difficulties of these two industries that have grown in the past few years.
We cannot afford to allow our great ship-repairing industry to be prejudiced by not having the requisite dry docks. On the other hand, we must realise that this industry faces a difficult future. This is aggravated by the fact, which the hon. Member for Portsmouth, Langstone (Mr. Stevens) mentioned, that in every country there is some form or other of discrimination in favour of the shipbuilding and ship-repairing industries.
9.45 p.m.
Today, ship repairing and shipbuilding are facing a real crisis. It would be better to recognise this now rather than to wait, as we did in the case of the cotton industry, until the industry faces conditions far worse than those obtaining now. We can see the future of these industries fairly plainly now. We can see the intense subsidised competition which they will both meet over the next few years. We can measure the intensification of that competition because of the over-capacity in the world.
Even though the hon. Member for Sunderland, South is not with us, I appeal to the Chancellor, whether he accepts the Amendment or not, to give a satisfactory undertaking to the Committee. He has failed to do this for the industry. It is an open secret that the shipping, ship- building and ship-repairing industries have made approaches to the Chancellor, but have failed to persuade him. Now that we are discussing the matter, I hope that we shall get an undertaking from the Chancellor that we shall not wait for these industries to fall into the conditions into which the cotton industry has fallen and that action will be taken now, while there is time.
Finally, I agree with the hon. Lady in what she said about the specially designated D.A.T.A.C. areas. My right hon.


Friend the Member for South Shields (Mr. Ede) and I represent constituencies which have been specially designated, but I agree that it would be wrong that aid for dry docks should be determined by that factor. That is why I mentioned the North-East Coast as a whole. It is a district which is rightly proud of its prowess in ship repairing, but I should like to see any aid which comes to the North-East determined by the proposals put forward by those in the industry to build new dry docks rather than determined by D.A.T.A.C. considerations. Incidentally, we have had nothing so far from D.A.T.A.C., so that that is largely an academic question.
I hope that the Chancellor will give us a satisfactory assurance that there will be discrimination in favour of the ship-repairing industry.

Mr. Amory: I thought that my hon. Friend the Member for Tynemouth (Dame Irene Ward) gave a slightly over-coloured picture of my yachting activities. I should like to assure her that practically every time that I go sailing I go past the Isle of Grain oil refinery where there is usually a long row of large tankers which I study with interest. My hon. Friend has invited me to go to sea with her in a tanker. I would enjoy that very much, and if the Recess were to be longer I would issue an invitation to her to sail round to Tynemouth so that she could show me the sights.

Dame Irene Ward: I would accept it.

Mr. Amory: My hon. Friend quoted "The Owl and the Pussy Cat". I do not want to press that analogy too far, but if she had gone a bit further I seem to remember that
The owl looked up to the stars above and sang to a small guitar,
'Oh beautiful pussy, oh pussy my love, what a beautiful pussy you are'.

Mr. John Edwards: May I remind the Chancellor that in the end the owl married the pussy cat?

Mr. Amory: Being a cautious man, I said that I did not want to press the analogy too far this evening.
Seriously, because it is a serious proposition that my hon. Friends have made, I am sorry that I do not feel able to accept their proposal. I feel that the treatment that we are giving to docks at

present, compared with anything else, is relatively favourable.
What are we doing? In some directions it is straining it rather to regard a dock as equivalent to an industrial building, but we are increasing the advantage there by substituting the investment allowance of 10 per cent. for 10 per cent. of the initial allowance. I would remind hon. Gentlemen that last year we increased the initial allowance and docks got the benefit of it. This year we are increasing the investment allowance, and docks will get the benefit of that. My hon. Friend also mentioned gates and the motivating machinery; they get the higher rate of investment allowance applicable to plant and machinery.
My hon. Friend the Member for Portsmouth, Langstone (Mr. Stevens) implied that most other countries, if not every other country, give better treatment in allowances on docks than we do; but, as far as I have been able to discover, only one other country has anything equivalent to the investment allowance applicable to docks.
My hon. and learned Friend the Member for Epsom (Mr. Rawlinson) said that docks were a special case because they were a one-purpose asset. If one thinks of it, that applies to a very great number of industrial buildings which are not adaptable for general purposes. Many of them are specialist buildings which attract only the industrial building rate of allowance. The kiln analogy is not a precise one because a kiln is in many respects analogous to a single bit of machinery.
My hon. and learned Friend also mentioned that in some countries floating docks attract the allowance appropriate to plant and machinery. I would remind him that in this country a floating dock would be treated as plant and machinery.
My hon. and learned Friend also implied that the shipbuilding industry had received very little help from the Government. I do not think that is quite fair. That industry has enjoyed the benefit of the increase in the initial allowances last year, the increase in investment allowances applicable to plant and machinery and their buildings this year and a considerable benefit also this year from the reduction in the standard rate. In addition to that, the Government are assisting, and are willing to


assist, docks in D.A.T.A.C. areas, and the Government have already expressed their willingness to assist in a substantial way in the case of two applications. That helps with the unemployment problem at the same time.
I do not quarrel with what my hon. and learned Friend said about a discrimination in certain cases. That is fair; we already discriminate in certain cases. In brief, however, what I feel in this case is that it would be asking me to go beyond what is reasonable to treat the whole of the expenditure on a dry dock as if it were plant and machinery. The profitability of a dry dock has been mentioned. That cannot be considered in isolation. As far as profitability goes, a dry dock must surely be considered one among a number of different aspects inside the business of a shipbuilding concern, whether it is owned by the concern or whether its use is rented.
Therefore, I feel that at the present time with our present proposals we are extending the benefits which are available, and will be available, to dry docks and that it would not be reasonable to ask me to treat the whole of the expenditure on a dry dock as if it were plant and machinery. So with very great regret, I am afraid that I cannot see my way to accept the Amendment.

Mr. E. Fernyhough: I am sure that the hon. Lady the Member for Tynemouth (Dame Irene Ward) and others who have taken part in the debate on this Amendment will be very disappointed with the Chancellor's miserable reply. The Chancellor should appreciate that what is now being asked is, in the words of the old proverb, a stitch in time to save nine. He is dealing with an industry which is facing more unfair competition than any other industry in this country. The competition is unfair because practically every other maritime nation finds some way, by subsidy or taxation relief, to assist its shipping industry.
The right hon. Gentleman said that he could not meet what the Amendment suggested in respect of dry docks. Does he not realise that unless we have those dry dock facilities available, the little he saves by turning down the Amendment will have to be paid out tenfold or even one hundred fold in increased unemployment benefit because of the Government's

indifference and neglect of the claims of this industry?
The right hon. Gentleman said that under D.A.T.A.C. advances had already been made for two dry docks. One of them is in my constituency and I am glad that the Treasury found it possible to advance a considerable sum at an agreed rate of interest.

Mr. Ellis Smith: What about Salford?

Mr. Fernyhough: Unfortunately I do not think that there is room in Salford for a big dry dock of this character. Otherwise, I am sure that Salford's claim would be considered equally sympathetically.
The firm concerned and all the people in the industry were very glad that the Government decided to make this generous gesture, but the Government themselves should be delighted, because these dry docks are being constructed at a time when the Tyne is almost full of laid up ships because there is no work for them. The firm is prepared to spend its capital and run the risk involved in providing these facilities although at present it can see no future use for them.
The Chancellor should understand that what has been said about the increasing size of tankers and other ships is perfectly true, and that if we do not provide those facilities other countries will do so and get the ship-repairing business which should come to this country.
The shipbuilding and ship-repairing industries had a lean time for the best part of a generation, except during the war years. Everybody knows what happened from the end of the 1914-18 war until the 1939-45 war. As my right hon. Friend the Member far South Shields (Mr. Ede) said, men trained in those skills had to seek work elsewhere. We can all recall that immediately war broke out in 1939 there was a frenzied effort to get the men who had been discarded for lack of work to take up the work for which they had been trained. Such a state of affairs may happen again. Everybody hopes that that will not be the case, but it would be unfortunate if this skill and ability were lost to an industry simply because the Chancellor was not prepared to make this helpful concession.
10.0 p.m.
The Chancellor must know of the many difficulties confronting the industry. He must know that we are in an unfavourable position compared with other maritime nations. We are not asking him to give money away. I understand that this is not some money that he gives away, but merely postpones collecting until a later date. Why, in the name of fortune, with the ship-repairing industry in its present state, he should refuse to make this concession I do not know.
The Chancellor must face this fact, and it is as well that the Committee should face it, too. Unless we spend money to bring our industries up to date and give those employers who have the courage in this time of recession to go in for an expansionist policy we shall spend this sum a hundred times over, and probably a thousand times over, in paying out unemployment benefit to men who, if the Chancellor had been a little more farsighted, might have been engaged in work which would have provided them with wages and provided the country with the trade and income that everybody wants to see it enjoy.

Dr. Horace King: The hon. Lady the Member for Tynemouth (Dame Irene Ward) and her hon. Friends who tabled the Amendment have done the Committee a service. Those of us who represent ship-repairing ports are exceedingly grateful to her. I speak for the trade unionists and the master men in the ship-repairing industry in the port of Southampton, which I represent together with the hon. Gentleman the Member for Southampton, Test (Mr. J. Howard).
The shipping and the ship-repairing industries are in a bad way. I hope that the two industries will get together. I hope that this debate will be the beginning of the time when the Government will get behind these industries in the problems that they face.
I am assured by my hon. Friends that the ship-repairing industry faces competition from abroad and is losing contracts abroad because many foreign countries,

if not giving direct subsidies, are giving either concealed subsidies or other forms of Government aid to their own ship-repairing industries. If our own industry is to survive, aids of the kind mentioned in the Amendment might help in its struggle to keep going.
It is a truism to say that both shipping and ship-repairing play vital parts in a war. Every member of the Committee knows, from figures recently given by the Ministry of Labour, that while there has been an upturn in the employment position in almost every other industry in the country, that is not true of ship-repairing. In Southampton the figures are higher than they have been since the war. These men have highly specialised skills and they cannot be deflected into other industries.
If Southampton is not a D.A.T.A.C. area so far as this industry is concerned, unless help is given that possibility may arise. I ask the Chancellor to give a little more consideration to the plea which the hon. Lady the Member for Tynemouth made in proposing the Amendment.
Most of the ship-repairing industries suffer from lack of adequate docking facilities. In Southampton we have to provide facilities for passenger and commercial ships, and at the same time provide docking facilities for ship-repairing. We have not got them. Any help that the Chancellor can give towards providing these facilities will be a useful contribution to the industry.
We face competition from abroad on a scale unknown since the war. Both sides of industry must get together to seek ways of improving its efficiency. We cannot solve its problems without help from the Government. This may be a way in which help could be given. It might be regarded as a token action on the part of the Chancellor which could be followed by other Government Departments to help in the solution of those problems.

Question put, That those words be there inserted:—

The Committee divided: Ayes 158, Noes 199.

Division NO. 114.]
AYES
[10.7 p.m.


Ainsley, J. W.
Griffiths, William (Exchange)
Owen, W. J.


Albu, A. H.
Hale, Leslie
Padley, W. E.


Allen, Arthur (Bosworth)
Hall, Rt. Hn. Glenvil (Coine Valley)
Palmer, A. M. F.


Allen, Scholefield (Crewe)
Hamilton, W. W.
Parker, J.


Awbery, S. S.
Hannan, W.
Parkin, B. T.


Bacon, Miss Alice
Hayman, F. H.
Paton, John


Benn, Hn. Wedgwood (Bristol, S.E.)
Healey, Denis
Pearson, A.


Blackburn, F.
Henderson, Rt. Hn. A. (Rwly Regis)
Peart, T. F.


Blenkinsop, A.
Herbison, Miss M.
Pentland, N.


Blyton, W. R.
Hewitson, Capt. M.
Plummer, Sir Leslie


Boardman, H.
Hobson, C. R. (Keighley)
Prentice, R. E.


Bottomley, Rt. Hon. A. G.
Holman, P.
Price, J. T. (Westhoughton)


Bowden, H. W. (Leicester, S.W.)
Holmes, Horace
Price, Philips (Gloucestershire, W.)


Bowles, F. G.
Houghton, Douglas
Probert, A. R.


Braddock, Mrs. Elizabeth
Hughes, Cledwyn (Anglesey)
Pursey, Cmdr. H.


Brockway, A. F.
Hughes, Emrys (S. Ayrshire)
Rankin, John


Broughton, Dr. A. D. D.
Hughes, Hector (Aberdeen, N.)
Redhead, E. C.


Brown, Rt. Hon. George (Belper)
Hunter, A, E.
Reynolds, G. W.


Brown, Thomas (Ince)
Hynd, H. (Accrington)
Rhodes, H.


Burke, W. A.
Hynd, J. B. (Attercliffe)
Robinson, Kenneth (St. Pancras, N.)


Burton, Miss F. E.
Irvine, A. J. (Edge Hill)
Rogers, George (Kensington, N.)


Carmichael, J.
Irving, Sydney (Dartford)
Ross, William


Castle, Mrs. B. A.
Janner, B.
Short, E. W.


Champion, A. J.
Jay, Rt. Hon. D. P. T.
Silverman, Julius (Aston)


Chetwynd, G. R.
Jeger, George (Goole)
Silverman, Sydney (Nelson)


Cliffs, Michael
Jeger, Mrs. Lena (Holbn &amp; St. Pncs, S.)
Skeffington, A. M.


Coldrick, W.
Jones, Rt. Hon. A. Creech (Wakefield)
Slater, J. (Sedgefield)


Corbet, Mrs. Freda
Jones, Jack (Rotherham)
Smith, Ellis (Stoke, S.)


Craddock, George (Bradford, S.)
Jones, J. ldwal (Wrexham)
Snow, J. W.


Cronin, J. D.
Kenyon, C.
Sorensen, R. W.


Croesman, R. H. S.
King, Dr. H. M.
Soskice, Rt. Hon. Sir Frank


Davies, Harold (Leek)
Lawson, G. M.
Spriggs, Leslie


Davies, Stephen (Merthyr)
Lee, Frederick (Newton)
Stones, W. (Consett)


Deer, G.
Lee, Miss Jennie (Cannock)
Summerskill, Rt. Hon. E.


Delargy, H. J.
Lindgren, G. S.
Sylvester, G. O.


Diamond, John
Mahon, Dr. J. Dickson
Taylor, Bernard (Mansfield)


Ede, Rt. Hon. J. C.
McAlister, Mrs. Mary
Taylor, John (West Lothian)


Edelman, M.
McCann, J.
Thomas, lorwerth (Rhondda, W.)


Edwards, Rt. Hon. John (Brighouse)
MacColl, J. E.
Thomson, George (Dundee, E.)


Edwards, Rt. Hon. Nese (Caerphilly)
McInnes, J.
Thornton, E.


Evans, Albert (Islington, S.W.)
McKay, John (wallsend)
Ward, Dame Irene (Tynemouth)


Evans, Edward (Lowestoft)
MacPherson, Malcolm (Stirling)
Watkins, T. E.


Fernyhough, E.
Mahon, Simon
Wells, William (Walsall, N.)


Fletcher, Eric
Mann, Mrs. Jean
Wheeldon, W. E.


Forman, J. C.
Marquand, Rt. Hon. H. A.
Willey, Frederick


Fraser, Thomas (Hamilton)
Mitchison, G. R.
Williams, Rt. Hon. T. (Don Valley)


Gibson, C. W.
Morris, Percy (Swansea, W.)
Willis, Eustace (Edinburgh, E.)


Gordon Walker, Rt. Hon. P. C.
Moyle, A.
Wilson, Rt. Hon. Harold (Huyton)


Greenwood, Anthony
Mulley, F. W.
Winterbottom, Richard


Grenfell, Rt. Hon. D. R.
Noel-Baker, Rt. Hon. P. (Derby, S.)
Woof, R. E.


Grey, C. F.
Gram, A. E.
Yates, V. (Ladywood)


Griffiths, David (Bother Valley)
Orbach, M.
Zilliacus, K.


Griffiths, Rt. Hon. James (Lianally)
Oswald, T.
TELLERS FOR THE AYES:




Mr. Simmons and Mr. Wilkins.




NOES


Agnew, Sir Peter
Boyle, Sir Edward
du Cann, E. D. L.


Aitken, W. T.
Braine, B. R.
Dugdale, Rt. Hn. Sir T. (Richmond)


Allan, R. A. (Paddington, S.)
Brewis, John
Duncan, Sir James


Amory, Rt. Hn. Heathcoat (Tiverton)
Bromley-Davenport, Lt Col. W. H.
Elliott, R.W.(Ne'castle upon Tyne, N.)


Armstrong, C. W.
Browne, J. Nixon (Craigton)
Emmet, Hon. Mrs. Evelyn


Ashton, H.
Bryan, P.
Errington, Sir Eric


Atkins, H. E.
Burden, F. F. A.
Erroll, F. J.


Baldock, Lt.-Cmdr. J. M.
Butler, Rt. Hn. R.A.(Saffron Walden)
Fell, A.


Baldwin, Sir Archer
Carr, Robert
Finlay, Graeme


Barber, Anthony
Cary, Sir Robert
Fisher, Nigel


Barlow, Sir John
Channon, H. P. G.
Fletcher-Cooke, C.


Barter, John
Chichester-Clark, R.
Fort, R.


Botsford, Brian
Conant, Maj. Sir Roger
Freeth, Denzil


Beamish, Col. Tufton
Cooke, Robert
Galbraith, Hon. T. G. D.


Bell, Philip (Bolton, E.)
Cooper, A. E.
Gammons, Lady


Bevins, J. R. (Toxteth)
Cordeaux, Lt.-Col. J. K.
George, J. C. (Pollok)


Biggs-Davison, J. A.
Corfield, F. V.
Glover, D.


Bingham, R. M.
Craddock, Beresiord (Speithorne)
Glyn, Col. Richard H.


Birch, Rt. Hon. Nigel
Crosthwaite-Eyre, Col. O. E.
Godber, J. B.


Bishop, F. P.
Cunningham, Knox
Goodhart, Philip


Black, Sir Cyril
Dance, J. C. G.
Gough, C. F. H.


Body, R. F.
Davidson, Viscountess
Gower, H. R.


Bonham Carter, Mark
D'Avigclor-Goldsmid, Sir Henry
Graham, Sir Fergus


Bowen, E. R. (Cardigan)
de Ferranti, Basil
Green, A.


Boyd-Carpenter, Rt. Hon. J. A,
Doughty, C. J. A.
Gresham Cooke, R.







Grimond, J.
Loveys, Walter H.
Russell, R. S.


Gurden, Harold
Lucas-Tooth, Sir Hugh
Sharpies, R. C.


Hall, John (Wycombe)
Macdonald, Sir Peter
Shepherd, William


Harris, Reader (Heston)
McLaughlin, Mrs. P.
Simon, J. E. S. (Middlesbrough, W.)


Harrison, Col. J. H. (Eye)
McMaster, S. R.
Spearman, Sir Alexander


Harvey, Sir Arthur Vere(Macclesf'd)
Macmillan, Rt Hn. Harold(Bromley)
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Harvey, John (Walthamstow, E.)
Maitland, Cdr. J. F. W.(Horncastle)
Stanley, Capt. Hon. Richard


Heald, Rt. Hon. Sir Lionel
Maitland, Hon. Patrick (Lanark)
Steward, Harold (Stockport, S.)


Heath, Rt. Hon. E. R. G.
Markham, Major Sir Frank
Steward, Sir William (Woolwich, W.)


Henderson, John (Cathcart)
Marples, Rt. Hon. A. E.
Stoddart-Scott, Col. Sir Malcolm


Henderson-Stewart, Sir James
Mathew, R.
Storey, S.


Hill, Mrs. E. (Wythenshawe)
Mawby, R. L.
Studholme, Sir Henry


Hill, John (S. Norfolk)
Maydon, Lt.-Comdr. S. L. C.
Summers, Sir Spencer


Hinchingbrooke, Viscount
Medllcott, Sir Frank
Taylor, Sir Charles (Eastbourne)


Hirst, Geoffrey
Molson, Rt. Hon. Hugh
Teeling, W.


Holland-Martin, C. J.
Mott-Radcliffe, Sir Charles
Temple, John M.


Holt, A. F.
Heave, Airey
Thomas, Leslie (Canterbury)


Hornby, R. P.
Nicholson, Sir Godfrey (Farnham)
Thompson, R. (Croydon, S.)


Horobin, Sir Ian
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Thorneycroft, Rt. Hon. P.


Horsbrugh, Rt. Hon. Dame Florence
Noble, Michael (Argyll)
Thornton-Kemsley, Sir Colin


Howard, Hon. Greville (St. Ives)
Nugent, Richard
Turner, H. F. L.


Howard, John (Test)
Oakshott, H. D.
Turton, Rt. Hon. R. H.


Hughes, Hallett, Vice-Admiral J.
Ormsby-Gore, Rt. Hon. W. D.
Vane, W. M. F.


Hughes-Young, M. H. C.
Osborne, C.
Vaughan-Morgan, J. K.


Hurd, Sir Anthony
Page, R. G.
Vickers, Miss Joan


Hutchison, Michael Clark (E'b'gh, S.)
Partridge, E.
Vesper, Rt. Hon. D. F.


Hylton-Foster, Rt. Hon. Sir Harry
Peel, W. J.
Wade, D. W.


Iremonger, T. L.
Peyton, J. W. W.
Wakefield, Edward (Derbyshire, W.)


Jenkins, Robert (Dulwich)
Pickthorn, Sir Kenneth
Wakefield, Sir Wavell (St. M'lebone)


Johnson, Eric (Blackleg)
Pike, Miss Mervyn
Walker-Smith, Rt. Hon. Derek


Kerr, Sir Hamilton
Pilkington, Capt. R. A.
W all, Patrick


Kirk, P. M.
Pitman, I. J.
Ward, Rt. Hon. G. R. (Worcester)


Lancaster, Col. C. G.
Pitt, Miss E. M.
Webbe, Sir H.


Langford-Holt, J. A.
Pott, H. P.
Webster, David


Leavey, J. A.
Powell, J. Enoch
Williams, Paul (Sunderland, S.)


Legge-Bourke, Maj. E. A. H.
Price, David (Eastleigh)
Wills, Sir Gerald (Bridgwater)


Legit, Hon. Peter (PetersfieId)
Prior-Palmer, Brig. O. L.
Wilson, Geoffrey (Truro)


Lindsay, Hon. James (Devon, N.)
Ramsden, J. E.
Wolrige-Gordon, Patrick


Lindsay, Martin (Solihull)
Redmayne, M.
Woollam, John Victor


Linstead, Sir H. N.
Remnant, Hon. P.



Lloyd, Maj. Sir Guy (Renfrew, E.)
Ridsdale, J. E.
TELLERS FOR THE NOES:


Longden, Gilbert
Roper, Sir Harold
Mr. Brooman-White and



Ropner, Col. Sir Leonard
Mr. Whitelaw

Motion made, and Question proposed, That the Clause stand part of the Bill.

10.15 p.m.

Mr. John Peyton: At the beginning of last month 183 British ships were laid up. I want to take this opportunity very briefly to express my surprise and regret that there is nothing in the Bill to deal with the problems of the shipping industry. I also express surprise that there is as yet no Amendment on the Notice Paper concerning this industry. There is no doubting the good will which has been shown by successive Governments, who have accorded it exceptional treatment, and no doubting the good will shown by Parliament. We give due credit to the Opposition here—

Mr. H. Wilson: Is it in order, Sir Charles, in a debate on the Question, That the Clause stand part of the Bill, to discuss what is not in the Clause?

The Chairman: One can deal only with what is in the Clause.

Mr. Peyton: With great respect, one of the points I am going to deal with is that of investment allowances. Am I not

in order in expressing regret that the shipping industry is not benefiting from this Clause?

The Chairman: Only what is in the Clause can be debated on the Question, That the Clause stand part of the Bill. One cannot deal with Amendments which have not been called.

Mr. Diamond: At this very late hour one wants to make one's points extremely short and I shall endeavour to do so. The point I am arising comes under initial allowances. If we read the title of this Clause, we see that it is:
Restoration of investment allowances, and additional grant of initial allowances in certain cases.
We are dealing with initial allowances and I shall deal with initial allowances granted in respect of private motor cars. The first part of the Clause is careful to exclude private motor cars from the benefit of investment allowances. It is careful to exclude them because the Government recognise that it would be wholly improper and indefensible for private motor cars to get the benefit of investment allowances. Private cars get the benefit


of initial allowances and it is to be regretted that initial allowances have not been withdrawn from private cars. This Clause gives an opportunity of pleading once more for that withdrawal.
The reasons are that the continuation of these allowances are both undesirable and unnecessary. It is undesirable because it provides much too great an inducement to people to buy cars when they receive an initial allowance of 30 per cent. and the ordinary wear and tear or depreciation allowance, so that anyone buying a new or secondhand car gets more than 50 per cent. allowed as an expense in the first year of purchase. That is far too great an inducement and quite an undesirable one. Indeed, it is unnecessary because, as we know, the motor car industry is flourishing and there is no reason why the sale of additional cars should be encouraged.
Perhaps this point is not always appreciated, but that the allowance is unnecessary is proved by the fact that it is not always claimed. In many cases it turns out that the allowance would be so great in the first year and so small in a subsequent year that, to make up for that, it suits people who own private cars and use them partly for professional or business purposes to spread the allowance and, therefore, not be subject to the disadvantage of paying it back at a later stage.
Because the continuation of initial allowances on private cars is both undesirable and unnecessary, I wish once more to call it to the attention of the Government in the hope that they will show their desire to stop what is a quite unnecessary allowance—almost a fiddle "—and encourage a proper appreciation of the rights of people as to their taxation responsibilities so that they do not have temptation put in their way by the enormous inducement to buy larger and more expensive cars.

Mr. John Howard: I am pleased to see this Clause before the Committee, in particular since it continues investment allowance for the shipping industry, which my right hon. Friend singled out some years ago for special treatment. We have been debating the question of allowances for dry docks, but I feel that my right hon. Friend should tackle the problem of the shipping

industry not merely by having investment allowances in the present form, but by making an arrangement whereby the industry can benefit through initial allowances, investment allowances and capital allowances already granted to firms in the industry through spreading such allowances backwards.
At present the industry is suffering severe depression and it is no use giving it investment allowances which it cannot use. It would be far better to make an arrangement whereby past profits could be used against any further and new investment allowances. We have talked about a recession in the shipbuilding and ship-repairing trade, but my contention is that we must tackle this at the right point and give the allowances to that part of the industry that needs it.

Mr. H. Wilson: On a point of order. Would it be possible to do this without legislation? If not, it would require legislation and that is not in the Clause as it now stands. How can it be done?

The Chairman: I was waiting for the hon. Gentleman to develop his argument. We can only deal with what is in the Clause.

Question put and agreed to.

Clause ordered to stand part of the Bill.

Consideration of postponed Clauses 18 to 28 and of new Clauses further postponed till after consideration of Schedules 4 and 5.—[Mr. Amory.]

Mr. H. Wilson: I beg to move, That the Chairman do report Progress and ask leave to sit again.
I think that the Chancellor will agree that we have made fairly good progress today. Some of us rather hoped that it might have been possible to get further through the Bill before the Recess, so that the time left after the Recess could have been devoted more to the new Clauses. However, I think that we have made good progress and are only an hour or two behind that rather optimistic schedule.

Viscount Hinchingbrooke: What schedule?

Mr. Wilson: I have just used the phrase that some of us hoped that we might have dealt with more of the Bill before the Recess to enable us to use more time after the Recess, and I said


that we were only an hour or two behind that schedule. If I had pronounced it "skedule" I could have understood the noble Lord being upset and I would have been upset, too. I think that we have made quite good progress. I am sure that the Chancellor will agree with this.
We have accepted the Chancellor's procedural Motion. I hope that we can get through the remaining Clauses of the Bill with that constructive criticism which, I am sure, the noble Lord, in common with my hon. Friends, desires, with suitable expedition, which I am quite sure the Chancellor desires, and that we shall be able to have plenty of time allotted to us after the Whitsun Recess for discussion of very important new Clauses on the Notice Paper, including one in the name of the noble Lord. I think that we have plenty of time for that, but that we have got as far as we can tonight. There is other business on the Order Paper.

Mr. Amory: I agree with the right hon. Gentleman. I think that we have made quite good progress, although perhaps not quite as good as we had hoped in our more optimistic moments. We have been discussing important matters and I have no quarrel with the amount of time which has been taken on them. The right hon. Gentleman's proposal that you do report Progress, Sir Charles, is perfectly reasonable; we can rest on the progress which we have made and come back, I hope, stimulated and refreshed from a short holiday and complete the remaining stages of our consideration of the Bill with exceptional expedition. I therefore support the Motion.

Question put and agreed to.

Committee report Progress; to sit again Tomorrow.

Orders of the Day — HOUSE PURCHASE AND HOUSING BILL

Lords Amendments considered.

Clause 6.—(AMOUNT OF STANDARD GRANT.)

Lords Amendment: In page 6, line 14, at end insert:
(3) The reduction required by subsection (2) of this section in respect of any of the standard amenities shall not be made if part of the cost incurred in executing the works was attributable to interference with or replacement of that amenity and the local authority are satisfied that it would not have been reasonably practicable to avoid the interference or replacement.

10.26 p.m.

The Minister of Housing and Local Government and Minister for Welsh Affairs (Mr. Henry Brooke): I beg to move, That this House doth agree with the Lords in the said Amendment.
The perspicacity of hon. Members will have revealed to them that this and the other two Lords Amendments cover the same point, where it arises in different Clauses. The issue is quite simple. It has come to light that it might not be possible to install all the standard amenities in a house without interfering with or moving one which is there already. The most obvious case, which would most often arise, is the house which has a water closet but which lacks other modern facilities, and yet in order to install the other facilities it is necessary to move the w.c. Under the Bill as it stands, the fact that the house already had a w.c. would mean that the maximum grant which could be paid under the Bill would not be £155 but only £115. Nevertheless, the owner of the house, carrying out what is the object of the Bill, would necessarily be put to expense in moving the w.c. from where it is and putting it elsewhere.
It might similarly arise that the house had a food store in a scullery and it was necessary to convert that scullery into a bathroom in order to equip the house with all the standard amenities. In that case, under the Bill as it stands the owner would he entitled to receive not the full £155 but only £145.
These three Amendments are designed to correct that. The first, which I have


moved, deals with the privately-owned house. The second deals with the local authority house. The third deals with Scotland. I do not think that there is anything in the wording of the Amendment which I need explain. The House will see that a local authority must be satisfied that it would not have been reasonably practicable to undertake the improvement in some other way. If it is so satisfied, the local authority will be required under the Amendments to assess the grant without making a reduction from the maximum.

Mr. G. R. Mitchison: As I understand the effect of the Amendment, if a man has one of the amenities already and has to move it, for the cost of moving it he receives that contribution which he would have received if it had had to be supplied as a new amenity.
This opens up some rather curious possibilities, not, I agree, in connection with large amounts. But in most of these cases the amounts contemplated bear some relation to the cost of the actual object that was installed, the bath or the washhand basin or whatever it was, and in these cases, for merely moving a bath, one gets from a generous Government the same contribution that one would have received if one had put in a new bath. I may have misunderstood the Amendment, but I thought that was what it meant and that was what I understood the right hon. Gentleman to say.
Since we are dealing with comparatively small amounts I should not have thought it a matter worth objecting to at this stage, but the Government ought to meditate more profoundly about the possible effects of putting in baths, basins, and so on, and the financial consequences of what they are doing. They ought to bear in mind, as we reminded them at an earlier stage of the Bill, that there is the further possibility in connection with this sort of thing that someone will find that he has been deprived of a perfectly good bedroom because a bath has been put in and, in consequence. the house is overcrowded. However, I cannot go into that now.

Mr. Brooke: I would point out that there is a maximum limit of half the cost of the work.

Mr. Mitchison: And I would point out that new baths cost more than the moving of old baths.

Question put and agreed to.—[Special Entry.]

Clause 14.—(AMOUNT OF CONTRIBUTION UNDER S. 13.)

Lords Amendment agreed to: In page 10, line 38, at end insert:
(4) The reduction required by subsection (3) of this section in respect of any of the standard amenities shall not be made if part of the cost incurred in executing the works was attributable to interference with or replacement of that amenity and the Minister is satisfied that it would not have been reasonably practicable to avoid the interference or replacement. [Special Entry.]

Clause 21.—(AMOUNT OF STANDARD GRANT.)

Lords Amendment agreed to: In page 14, line 22, at end insert:
(3) The reduction required by subsection (2) of this section in respect of any of the standard amenities shall not be made if part of the cost incurred in executing the works was attributable to interference with or replacement of that amenity and the local authority are satisfied that it would not have been reasonably practicable to avoid the interference or replacement. [Special Entry.]

WAYS AND MEANS

Considered in Committee.

[Sir CHARLES MACANDREW in the Chair] Resolved,

ESTATE DUTY: RETENTION OR ASSUMPTION OF BENEFITS ON GIFTS INTER VIVOS
That, for the purposes of any condition of the law relating to estate duty which requires the exclusion of any benefit to a person where a gift is made of property, a benefit which a person obtained by virtue of operations associated with the gift shall be treated as a benefit to him by contract or otherwise.—[Mr. Erroll.]

Resolution to be reported.

Report to be received Tomorrow:

Committee to sit again Tomorrow.

COMPTROLLER AND AUDITOR GENERAL (SALARY)

Resolution reported,
That the rate of the salary which may be granted to the Comptroller and Auditor General under section one of the Exchequer and Audit Departments Act, 1957, be increased from six thousand pounds to seven thousand pounds per annum, and the date


from which, under subsection (3) of that section, the person now holding that Office is entitled to a salary at the said increased rate be the first day of February, nineteen hundred and fifty-nine.

Resolution agreed to.

POST OFFICE WORKS [MONEY]

Resolution reported,
That, for the purposes of any Act of the present Session to vest in the Postmaster-

General certain underground works constructed in London, Manchester and Birmingham in the exercise of emergency powers, it is expedient to authorise the payment, out of moneys provided by Parliament, of—

(a) any expenses incurred by virtue of the said Act by the Postmaster-General; and
(b)any expenses incurred in maintaining the works referred to in the said Act as "the London works", "the Manchester works "and" the Birmingham works".

Resolution agreed to.

Orders of the Day — SLUM CLEARANCE, BRISTOL

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Legh]

10.34 p.m.

Mr. W. A. Wilkins: I should like to express my appreciation to you, Mr. Speaker, for permitting me to change the subject of the Adjournment debate tonight and also to thank the Parliamentary Secretary to the Ministry of Housing and Local Government for his willingness to come here to answer the points which I propose to raise.
I am sorry that it will be necessary for me to adhere more rigidly to my notes than I normally like to do, but I want to be sure that the things I say are what I intended to say. Local government elections were held last week. Generally speaking, comparing results with three years ago, which is the right comparison, one might say that nothing particularly startling happened, with perhaps three exceptions.
One of these exceptions was in the City of Bristol, my own city. There we had a swing in the elections of nine seats to the opposition. Where there is a swing of that character there is generally a cause for it. It is probable that in Bristol there were two, maybe three, factors which contributed to the Conservative victory. What however, will not be denied is that the overwhelmingly predominant issue was that which I am taking as my Adjournment subject tonight.
I am seeking to obtain from the Government a declaration, or, what I think would probably be a more accurate description, a restatement of their slum clearance policy. I have been in politics for a fairly long time, long enough to learn that whatever one may feel about misrepresentation, recrimination gets one nowhere. When I feel that way I try to remind myself that politics are as dirty as one stoops to make them and as clean as one likes to keep them, and that, in the long run, no one in politics or in business ever profits from ill-gotten gains.
So I forget the result of the election and I examine the cause. Official advice which I have received from our local

authority—at my request, of course—up to Monday morning of this week shows that there have been confirmed by the Minister 52 compulsory purchase orders involving 980 "pink" properties, that is, properties that are regarded as being unfit for human habitation, and 332 "grey" properties, which means, of course, that they could be occupied perhaps for a short time in the future.
In those properties there are 1,358 families of which 338 are owner-occupiers. The first question that I want to ask the Parliamentary Secretary is whether it is in conformity with Government policy that unfit houses should be demolished and whether those 52 orders are justified. If the answer is "No", then I would ask why the Minister confirmed them.
The second point which arises is that there are now 11 orders which await the Minister's confirmation. They comprise 839 "pink" properties and 453 "grey" properties with an estimated number of 1,254 families, of which owner-occupiers number 527. The question which I want to ask the Parliamentary Secretary is whether, in view of the campaign conducted by some Conservatives—I emphasise the words "some Conservatives"—in Bristol, resulting in the setting up of organisations to resist compulsory purchase orders, which also appear to have been endorsed by the electors, the Government feel that they should abandon their slum clearance programme not only in Bristol but throughout the country and not proceed with these confirmations.
Of course, I do not want to give the Minister the impression that all Conservatives in Bristol are disloyal to him on this vital issue. I shall quote to him, in context, a paragraph which appeared in the Bristol Evening World of 7th October last. It was written by the present Conservative candidate for Bristol, Central, and, broadly speaking at any rate, I confirm it as my own experience. This is what he said:
When after an extensive recent canvass I am asked what is the main interest of the people on whom I called and I answer ' Housing' then the silence is broken by a scream of abuse from Wedgwood Benn. I have raised this subject of housing in Bristol because it is vital and urgent. I am at present in correspondence with the Bristol (Socialist) Council on the matter and have been invited


to meet the housing authorities. They at least appear able to treat the discussion with rational calm. Meanwhile, I say to Benn that if he comes out with me in Bristol and visits streets at random I will prove to him that the first consideration, as one goes from door to door, is not Quemoy or even how insulting Socialists can be to the Queen but, Can you tell me when this street is coming down?'
I now wish to quote some of the things said by Conservatives before and during the campaign, and by some of the victors afterwards. A very well-known Bristol alderman, who has been prominent in the formation of the home defence associations, speaking before the election in Easton, Bristol, said:
Those people who have voted for compulsory purchase orders on the Housing Committee have signed and presented, in my opinion, their own death warrant.
And how right he was. At the same meeting, the chairman said:
This is about the last chance we have to show our disgust about C.P.O.s. If Mr. Brewer is not successful in the election it will be the green light for the council to carry on as they are doing and even much faster.
Another ex-councillor of one of the wards in my own constituency—who, again, has been prominent in the build-up of the home defence associations —said:
Make no mistake, Mr. Brewer is going in. I say that the C.P.O.s are no more, and no less, than one dirty land-grab.
After the election, we have the gentleman who is probably now, or will be, within a day or two the leader of the opposition in the City Council in Bristol, saying, in the newspaper report:
Bristol… was 'sick and tired' of many Socialist policies and their complete abuse' "—
complete abuse—
of compulsory purchase and clearance orders.
In my judgment, if that is right it is not merely a reflection upon what the council is doing in Bristol, but a reflection on the Minister who has confirmed the orders that have been submitted to him. One of the candidates, I suppose in a moment of ecstasy on Friday, said, as the newspaper put it, that he
…will be keeping a watch on any legislation affecting independent retailers —and particularly on compulsory purchase orders. C.P.O.s? I hate them,' he briefly said.
I could go on quoting for quite a time all these things said before, during and

after the election, but I want now to refer to what I believe to be the crux of the whole matter. I believe that there would be little, if any, trouble at all if compensation payments bore any resemblance at all to being fair.
Compensation payments are made under different Acts and in three ways. First, there is the dwelling that is considered to be completely unfit for anyone to live in. That dwelling is considered to have no value at all except the value of the site on which it stands. Hence, quite frequently, we have this nominal payment of £1. Secondly, there is the house in the clearance area that is considered "well maintained," and has a "well maintained" value put on it by the district valuer, albeit it is not usually a very high value. Thirdly, there is the house that does not come into the unfit category at all but happens to be situated on a site that must be totally cleared so that the new development may take place. Compensation is paid on that house at market value. Of course, all three of these values are contested on grounds of inadequacy, but undoubtedly it is the first category which creates the greatest sense of injustice, particularly to those people who are owner-occupiers.
I wish that I had the time available tonight to explain how some of these people have come to buy these properties. I have not got the time, but they are, in fact, the real victims of our present Acts of Parliament. We here in Parliament understand how this £1 site value payment came into being. It was brought in to catch up with property speculators who bought up slum dwellings in order to cash in on compensation payments. But today it is catching, in the main, innocent people—people who were persuaded to buy the house in which they live because, as they were told, "It will only cost you half a crown or so more a week than the rent you now pay on a mortgage of £200."
If we take these people's houses from them they have not only to liquidate their outstanding mortgage, but also to meet the rent of another dwelling, which is usually a corporation house. I do not believe that any local authority really wants to treat its citizens in this way. But it is only here in Parliament that we can put this matter right.

Mr. Speaker: Order. It seems to me that we can only put it right by legislation.

Mr. Wilkins: I was not going to suggest legislation, Mr. Speaker. In a moment's time I was going to suggest that on a future occasion we might look at some of the Sections in the Acts which apply to this subject, but I am not asking for any legislation tonight. I am aware that I cannot do that.
Members of local authorities, our councillors, are just as much the victims of our Acts of Parliament as are the people who are involved in the clearance areas. They can do no more than they are doing. We really ought to consider these compensation provisions again, and I hope that the Parliamentary Secretary will say tonight that that will be done soon.
I have time for only one further reference and it is to the Town and Country Planning Bill, which has left this House and is now in another place. That is not really the answer and it is wrong that people should be given the impression that it is. At the most, it will give the equivalent of gross rateable value as compensation. In how many cases would this exceed £15? I suggest that it would be very few indeed. The property owners' journal, known as Property, claims that it gives nothing at all. Last month's journal said:
The purpose of the Bill is to establish fair market value as the basis of compensation when property is compulsorily acquired for public use, but it excludes from this new basis all property that is required for slum clearance.
Finally, I suggest that as clearance of areas under compulsory purchase orders may be spread over a number of years —perhaps even up to ten years—a local authority should be enabled to remove tenants who want to go on a voluntary basis, leaving those who prefer to remain until the last possible moment before site redevelopment must take place. But, of course, there is a snag about this. I understand that the housing subsidy which the Government give for slum clearance projects is paid to a local authority only at the point in time of the demolition of the house. I therefore suggest for the consideration of the Government that if the subsidy were made payable at the time when the tenant is

placed in a new corporation dwelling, it would certainly facilitate this voluntary method of transfer. Under present arrangements, local authorities have to carry too much financial obligation.
Mr. Speaker, I hope that I have been fair. I have tried to put the case objectively. On 12th March, two months before the elections took place, I wrote to the Minister of Housing and Local Government about this subject. I reminded him of what had transpired on the Report stage on the preceding day; and also told him of the activities of certain people in Bristol in connection with these compulsory purchase orders. I concluded my letter with these words, which I would like to put on the record tonight:
I am never the one to object to a fair battle. I support the slum clearance drive and am certain it would be carried out with less friction and greater speed if we all endeavoured to emphasise its ultimate benefits to the community. In this case, it happens to be a Labour-controlled council which is endeavouring to carry out your wishes. It could, of course, be a council of a different political complexion. Whoever's responsibility it may be, it is our job to help them, not hinder. It is so easy to inflame the passions of people who feel aggrieved, as we politicians well know. I would do everything in my power to secure justice in the way of compensation for those who lose their houses, but I do object to this issue being brought into the political cockpit by people who are your alleged supporters.
That I believe to be a true statement of fact.
I hope that tonight, as a result of what I have said here, at least it might be pointed out clearly to the people of my city where blame, if blame there be at all, rightly rests. It is for us here in Parliament to make the decisions that we will give better opportunities and better compensation, if necessary, to those people whom we want to remove from dwellings which many of us right down deep in our hearts will admit are not fit for people to live in and to give them a far better chance in life.
Only a few days ago, I drove through an area of my city which, in my time, had often had to be policed by three policemen at a time. It was one of those areas where few people would go and walk. There is now being erected—it is almost nearing completion, I believe—as fine a block of flats as anyone could wish to see anywhere. I find it incredible to believe that people really do not want


to have the opportunity of occupying places such as that in preference to those which they already have. Indeed, our experience, as a result of the canvassing we do, is clearly that the majority, probably 75 per cent., of these people are only too anxious to get out of those places and to accept these new buildings which are built by the corporation but which, in the main, are supplied under the slum clearance Acts.
I thank the Parliamentary Secretary for being good enough to agree to answer this Adjournment debate tonight.

10.55 p.m.

The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. J. R. Bevins): I am most grateful to the hon. Member for Bristol, South (Mr. Wilkins) for mentioning the subject of this Adjournment debate to me before this evening. Fortunately, my right hon. Friend has no administrative responsibility for the ups and downs of political parties in Bristol or elsewhere, and I ask the House to believe that what I am about to say is in no sense dictated by political considerations of any kind.
My right hon. Friend has, of course. a very large responsibility for slum clearance throughout the country. Between 1956 and the end of last year more than 138.000 houses had been pulled down in England and Wales and more than 400.000 people have been transferred from slums to decent homes. By the end of last year we had achieved our target of rehousing in Great Britain—not only England and Wales—as many as 200.000 people every year from the slums. I would say straight away to the hon. Member that it is the firm intention of Her Majesty's Government to see this operation through, and that the Government have no wish at all to create any obstacles which would impede the progress of slum clearance.
On the whole, I think that it is true to say that local authorities have been very successful in getting on with this job with relative smoothness and more or less with immunity from complaint. I am not saying that compulsory purchase is popular with the public. We all dislike compulsion in any form, but sometimes it is unavoidable. One thing that the Government are now in process of doing is to take at least some of the sting out of compulsory purchase by

going over to the compensation formula of market value.
Turning to the case of the City of Bristol, I would, first, take up the point made by the hon. Gentleman on the question of leaving certain houses in clearance areas in occupation until such time as the local authority can provide the tenants with new housing. The position there is that slum clearance subsidy is payable in respect of each new dwelling which is built in order to secure the rehousing of a family moved from a slum house. I understand that since June of last year the Bristol Corporation has been deferring the completion of purchase of certain houses in clearance areas until the occupants have actually been rehoused. That is in line with the policy which my right hon. Friend is, and has been, advocating to local authorities up and down the country.
The hon. Gentleman mentioned one or two figures about compulsory purchase orders and clearance orders for the City of Bristol. My information is that since the beginning of 1956 we have confirmed 38 compulsory purchase orders and 53 clearance orders. Some of these orders, of course, have not been confirmed as submitted by the local authority. As hon. Members on both sides will know, many orders are confirmed by my right hon. Friend subject to certain modifications, some of which allow for cases of hardship. and others commonly provide for the exclusion of "grey" land which the Minister may consider is not essential to the redevelopment which the local authority has in mind. At present, there are 13 compulsory purchase orders and 14 clearance orders which are outstanding and which will, of course, be considered on their merits.
In Bristol, for reasons into which I do not want to go too closely tonight, there has undoubtedly been a good deal of public disquiet over administration of compulsory purchase as a preliminary to slum clearance. I have looked at the matter with some care, and I should like to say a word or two about why I think this public disquiet has arisen.

Mr. Wilkins: In Bristol?

Mr. Bevins: Yes, in Bristol.
Originally, the Bristol City Council proposed, I understand, to clear 10,000 slum houses in a period of ten years, but with the advent of the Housing Subsidies Act. 1956, which abolished the general


needs subsidy, the Corporation had second thoughts and decided to speed up the period of clearance to within five years so as to get the best financial aid for the replacement of the old houses.
I do not comment on that. The Corporation was a free agent to do that or not to do that as it wished, but the decision to accelerate the pace of slum clearance meant that clearance, and compulsory purchase, orders had to be brought forward more rapidly than originally expected. I think that all hon. Members will agree that that put a good deal of strain on all those concerned with this operation in Bristol. That, in turn, led to the criticism that the Corporation was acting with rather more zeal than discretion.
I think that one can fairly say, without being political or biassed, that until a year or two ago not enough attention was paid to some of the human problems involved. For example, I understand that in almost every case the City Council, no doubt motivated by the best of intentions, to get a move on and make progress, embarked on compulsory acquisition without attempting to make purchases by agreement. Again, I am not saying that it is always possible or feasible to undertake purchase by agreement, but very often it is in the case of relatively small schemes.
It was also said that the valuations undertaken by Bristol's own valuers were not on the generous side, although I agree that the figures were influenced by the widespread existence in Bristol of rent charges which had the effect of bringing down values. As a result of all this, compulsory purchases were hotly contested and a good deal of resentment developed in the city.
It is only fair to add that more recently the Corporation has sought to meet some of the earlier criticisms and has been anxious to avoid individual hardships and I understand that it is now attempting to negotiate purchase by agreement in the case of relatively small sites. There is no doubt that the payment of nominal sums of £1 to the owners of unfit houses has exacerbated feeling in the city.
That was recognised by Bristol Corporation and hon. Members put several Questions to my right hon. Friend some months ago. It was represented, as it has repeatedly been represented by some of my hon. Friends, that the site basis

compensation for unfit houses ought to be changed. That change is to be made under the Town and Country Planning Bill, now before Parliament, to the extent that owner-occupiers who do not benefit under the Slum Clearance (Compensation) Act, 1956, and who are liable to receive only derisory compensation, will not in future get less for the site than the gross value for rating purposes.
I was a little surprised to hear the hon. Member refer to this change in the compensation provisions as being inadequate. After all, we are here dealing with houses which are unfit and which Parliament, for many years, has recognised should not be compensated for the structure but only for the land. It would surprise me if the hon. Gentleman could get the support of his hon. Friends for going beyond what has been proposed by my right hon. Friend.
In addition, it will continue to be the case that if a house has been well maintained in spite of its inherent defects, well maintained payments may be directed by the Minister. Those will not be less than nine times the rateable value of owner-occupied houses or four-and-halftimes the rateable value of rented houses. Houses which are acquired as "grey" land, that is to say, land outside that covered by an order but needed by the Corporation for satisfactory redevelopment of that area, will in future be assessed for compensation at full market value.

Mr. G. R. Mitchison: If these orders were oppressive for so long, why were they confirmed by the Minister?

Mr. Bevins: I thought that I made that clear at the outset when I said that quite a number of orders which were confirmed were confirmed subject to modifications, to eliminate features which seemed to my right hon. Friend to be undesirable.
I was about to say, in conclusion, that I am sure that the general public and certainly my right hon. Friend want to see progress with slum clearance maintained. Given the changes in compensation which are now in train and an understanding approach by local authorities—

The Question having been proposed after Ten o'clock, and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at five minutes past Eleven o'clock.